ABSTRACT
A clause that states that upon payment of a specified amount toward the principal reduction a portion of the property held for collateral to secure the loan will be released is a partial release clause. This clause is most often found in mortgages secured by property to be used for residential or commercial development into lots for sale. Upon the sale of a lot, the lender agrees to release the lot from the mortgage provided an agreed upon portion of the sale price is used to reduce the mortgage principal.
