Direction Re Funds (Purchase Money Mortgage)

Summary

This precedent is a "Direction Re Funds" for the advance of mortgage monies for the purchase of a property. It directs the mortgage lender to deposit the funds with the borrower/purchaser's lawyer, in Trust for completing the purchase on the day of closing. This document is one of many Closing Documents for the purchase of a property covering the financing of the transaction. This precedent contains practical guidance and drafting notes. "Purchase Money Mortgages" are mortgages intended to provide the funds required for the actual purchase of a property. They can be distinguished from "Collateral Mortgages" which are usually referred to as mortgages registered against real property which is already owned by the Borrower. In a "Collateral Mortgage", the borrower already owns the property and is using the said property as "security" for the receipt of funds. This money may be to finance renovations, make other investments, or provide additional capital for other projects and purchases ...