Section 60 Mortgage and Property Law of Lagos State

Section 60 of the Mortgage and Property Law of Lagos State 2010 is about Prohibition against negative amortisation. It provides as follows:

(1) No mortgage agreement may contain a payment schedule with regular periodic payments that cause or may cause the principal balance to increase.

(2) A loan is considered to have such a schedule if the borrower is given the option to make regular periodic payments that cause the principal balance to
increase, even if the borrower is also given the option to make regular periodic payments that does not cause the principal balance to increase.

(3) This section shall not prohibit negative amortization as a result of a temporary forbearance sought by a borrower.

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