Fogel v. S.S.R. Realty Associates

The opinion of the court was delivered by

POLOW, J.A.D.

On this appeal we must determine the enforceability of a conditional “due-on-sale” provision in a real estate mortgage. The bond and mortgage contain provisions permitting the mortgagor to transfer the property with prior approval of the mortgagee which “shall not be arbitrarily or unreasonably withheld.” The mortgagee refused to consent to the sale of the property without an additional agreement for an increase in the mortgage interest rate. When the sale took place without consent, plaintiff, the mortgagee, instituted suit to foreclose…