Zelda Owned a Piece of Land Called Blackacre

Essay

Zelda owned a piece of land called Blackacre.She borrowed $200 000 from the Bank of Regina.As security for the repayment of that loan,she created a mortgage over Blackacre.During the next 12 months,Zelda made several payments on the loan.At the end of that year,her debt to the Bank of Regina was reduced to $175 000.She then agreed to sell Blackacre to Fabio for $250 000.Fabio's lawyer has told him that there are two options for paying the purchase price.Under the first,Fabio would fulfill Zelda's obligation to repay the loan to the Bank of Regina.Under the second,Fabio would pay the purchase price by borrowing money from the Bank of Moncton,and by creating a new mortgage in favour of that bank.Explain in greater detail how each of those options would work.How would Fabio decide which option to use?