In lien theory, what effect does a mortgage have on joint tenancy?

In lien theory, when a mortgage is placed on a property held in joint tenancy, it does not immediately sever the joint tenancy. Instead, the joint tenancy remains intact unless a foreclosure occurs. This is because, under lien theory, the mortgage is considered merely a lien on the property rather than a transfer of title. The joint tenants retain their equal rights to the property until a legal process, such as foreclosure, is initiated due to default on the mortgage.

Upon foreclosure, the situation changes. If the property is sold at foreclosure, it results in the severance of the joint tenancy as the ownership cannot persist in its original form once a foreclosure sale occurs. Consequently, the rights of the original joint tenants are extinguished, and the purchaser at foreclosure takes title, often as a tenant in common with any remaining joint tenants. Thus, the mortgage itself does not sever the joint tenancy until the foreclosure takes place, making the option which states that it may sever joint tenancy only upon foreclosure the correct interpretation in the context of lien theory.