In this lesson we’ll learn about discharge and default in mortgages. We’ll discuss what happens if the mortgage debt is paid, and what happens next if it’s not.

I.               Prepayment and Discharge

As we’ve seen before, the note that underlies the mortgage is usually payable in a series of installments over a fixed term. A mortgagor might choose to pay the note early, which is called prepayment. For example, if the...