Which clause causes the cancellation of a lease or mortgage upon fulfilling a certain condition?

The defeasance clause is specifically designed to allow for the cancellation of a lease or mortgage once certain conditions have been met. It typically stipulates that if the borrower fulfills specific obligations, such as paying off the debt or meeting other contractual terms, the lender's interest in the property is voided. This clause is essential in mortgage agreements, as it acts as a mechanism to signify that the borrower has fully satisfied their repayment obligations, leading to the release of the lender's claim or lien on the property.

This clause contrasts with other types of clauses that may govern different aspects of a lease or mortgage agreement. For example, a termination clause generally outlines the conditions under which the agreement can be terminated but may not necessarily involve cancellation upon fulfillment of a condition. A default clause specifies the repercussions of failing to meet contractual obligations but does not provide a means to cancel the lease or mortgage upon achieving certain conditions. Lastly, a restoration clause might deal with restoring the property to a certain condition but does not pertain to the cancellation of the lease or mortgage itself. Thus, the defeasance clause is the one that effectively cancels the agreement upon the fulfillment of specified conditions.