Receipt of Mortgage Funds

Summary

This precedent is useful as a piece of evidence showing that mortgage money which was contractually promised from the mortgage lender to the borrower was in fact received by the borrower. The Receipt is intended to confirm and provide proof of money delivered (certified funds or otherwise) to complete a lending transaction. This document contains practical guidance and drafting notes. A formal “Receipt of Mortgage Funds” is not regularly used in most commercial mortgage transactions. It is often assumed that if the borrower had the funds to complete their transaction, then the mortgage monies were transferred from lender to borrower in a timely fashion. Usually, the money is deposited into a lawyer’s trust account and it is up to the lawyer, acting for the borrower, to ensure that things are properly done before the money is “released.” For example, for purchase monies to be released, there must be a duly registered Transfer of Land and immediately subsequent registration of the ...