What are the two obligations of lenders as covenants?

In the context of covenants, lenders have specific obligations that ensure the protection of both parties involved in a mortgage agreement. The two obligations commonly associated with lenders include the need to discharge the mortgage once the borrower has fulfilled their repayment obligations and the obligation to leave the borrowers in quiet possession of the property.

Discharging the mortgage means that once the loan has been completely paid off, the lender must remove their claim on the property, allowing the borrower to have full ownership without any encumbrance. Quiet possession refers to the lender's obligation to respect the borrower’s right to use and enjoy the property without interference. This is crucial for borrowers, as it ensures they can live in and utilize their home without fear of unwarranted actions from the lender.

The other options do not accurately reflect the fundamental obligations of lenders in a covenant. Collecting property taxes and maintaining the property typically falls under the responsibilities of the borrower, while providing loans at lower interest rates and reducing payment terms is contingent upon market conditions and the lender's policies, not a covenant obligation. Lastly, providing insurance and selling the property in case of default is more about the lender's rights to mitigate losses rather than their covenant obligations to the borrower.