UK Mortgage definition

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Assignment

In the context of mortgages, an Assignment means the assignment to the lender of life policies taken out to repay the capital at the end of the mortgage term, or on prior death of the borrower. A deed of assignment is required. This gives the lender the legal right to cash in the policy in the event of default by the borrower. It also requires the life company to inform the lender of lapsed payments or the policy being `paid up'. Many lenders no longer require assignment of life policies, though some take a deposit of the policy document instead.