that it is the same property heretofore conveyed to the seller by the man from whom he purchased, with a reference to the date and recording data of the deed under which the seller himself derived title. For instance, the description in the contract may contain the clause, "being the same premises heretofore conveyed to the seller by Richard Roe and Mary Roe, his wife, by deed dated October 4, 1920, and recorded in the office of the Clerk of Manhattan County, state of New York, on October 5, 1920, in Liber 50 of Deeds at page 600."

Following the description will come the terms of sale. If the sale is to be a cash transaction, a simple statement that the price is $20,000, payable in cash, $500 on the signing of contract, and the balance on the delivery of the deed, will suffice. If, however, a purchase money mortgage is to be given or payment made in instalments, care must be taken to see that the contract properly defines the intentions of the parties. The length of time for which the mortgage is to run and the rate of interest should be given. It is always advisable, also, from the point of view of the purchaser, to reserve the right to pay off the mortgage prior to its maturity date. Ordinarily the holder of the mortgage will be glad to have this done. When, however, a mortgage

is bringing in a good return and no equally attractive investments are available, he may be unwilling to allow the mortgagee to anticipate payment of the principal without the payment, at the least, of an additional consideration. If the purchaser wishes to make sure that he may pay off the principal, in whole or in part, in advance of maturity, he should see to it that the contract of sale provides that the bond and mortgage to be given shall contain clauses allowing this to be done.

In considering the contract of sale, submitted for his approval and signature, the purchaser should be particularly careful to note any provisions to the effect that the property is conveyed subject to any specified conditions. Any such provision in the contract means that the deed will convey title subject to the same defects, or encumbrances, as those specified in the sale contract. These may or may not be important, but it behooves the purchaser to proceed with special care when he encounters the words "subject to."

If it be stated that title is subject to a specified mortgage, it means that such a mortgage is outstanding and is a lien on the property. In such case it should be provided that a portion of the purchase price, equal in amount to the amount

of the mortgage, shall be paid by taking title subject to the mortgage. If for instance the price is $15,000 and there is a $10,000 mortgage, the purchaser pays the $15,000 by paying $5,000 in cash and $10,000 by taking the property subject to the mortgage.

It is well to note, also, the difference between taking title subject to a mortgage, and assuming the mortgage. In the former case, if you fail to pay the sums due under the mortgage, the property can be sold on foreclosure by the mortgagee, but he will not be able to hold you liable for any deficiency between the amount due and the sum realized on such sale. If, however, you have assumed the bond and mortgage and then are in default, the holder of the mortgage can hold you liable, under the bond which you have assumed, for any deficiency. Usually the purchaser is only asked to take subject to a mortgage. He should not assume the obligations of the bond and mortgage unless there are special and exceptional reasons for his doing so.

If the contract specifies that title is to be taken subject to certain restrictions, or rights of way, or agreements, be sure that you understand exactly what these are before you sign. Often a contract will say that title is to be taken subject to the restrictions contained in a certain prior

deed, to which reference is made. When this is the case, look up the deed referred to and check the extent and effect of the restrictions which it contains before proceeding further. Remember, always, that your deed will follow the contract of sale and that you will get no broader or better title by the deed than that which the contract of sale describes.

The contract will doubtless contain also a provision with respect to the apportionment of taxes, insurance, water charges, and the like. The meaning of such a provision is quite simple. Whether it is in the interest of the purchaser, or of the seller, will in each case be determined by the facts or the date of closing.

Assume, for example, that it is provided taxes shall be apportioned as of the date of closing, which is September 1, 1924; that the taxes become liens and are payable July 1st and January Ist in advance, and that the seller has paid on July 1st the taxes covering the period from then until January 1, 1925, and amounting to $300. In such case the purchaser would, on the closing, be called upon to allow to the seller two thirds of the taxes so paid, representing the proportion of the taxes paid for the period from September Ist to January 1st, the benefit of which payment

accrues to the purchaser. If, on the other hand, the January 1st tax payment is to be in payment of taxes for the preceding six months period, then the purchaser, taking title September 1st, should be allowed by the seller one third of the $300, representing the proportion of the taxes for the months of July and August, when the seller owned the property.

In the case of insurance, whether an apportionment is advantageous or disadvantageous will depend largely on whether the purchaser finds it more economical or advisable to cancel the existing insurance and take out new policies, or to take over and continue the existing policies. If the first course is followed, the seller should be able to cancel the old policies and receive a rebate of premium; hence, no apportionment will be necessary. If the latter course is followed, and the purchaser takes over the existing policies, it is fair and proper that he make an allowance to the seller for the advance premiums which the seller has paid. If the seller has, at the time of taking title, paid out $200 for premiums on policies which have then run for one half their term, the purchaser should allow him $100 for the balance of the term of the policies, the benefit of which accrues to the seller.