Often a life insurance policy is used as security for the payment of a mortgage.
The mortgagee, if there be buildings on the property, should see that the buildings are insured and that the policy or policies are made out in his name.
If the insurance policy is in the mortgagor's name he may collect and keep the insurance money.
The mortgagor must meet, as stipulated, every payment of the principal and interest.
Failure to meet one payment can result in a legal foreclosure.
When a payment is made, the date and the amount must be entered on the back of the note. This should be done in the presence of the mortgagor.
If possible always pay the obligation by check.
If a payment is accepted on a mortgage and the amount is not sufficient to meet the sum required, the interest is first settled in full, the rest is credited to the principal.
When the full amount, with interest, is paid in, it becomes the duty of the mortgagee to have the mortgage "discharged."
A complete settlement is when, all payments being made, the mortgagee surrenders the note and its security, and causes to be written by the register, on the margin of the copy in his books, the words, "discharged," or "satisfied," affixing thereto his official signature and the date.