(a) That's wrong. Although Y suffers from a disability that seriously diminishes his bargaining power and his ability to judge what is in his own best interests, it is unlikely that the mortgage will be set aside on grounds of unconscionable dealing under the general law.
This is because, although Y suffers from a disability that disadvantages him, this is not made obvious to the bank. Nor do the general circumstances in which the contract was signed raise the likelihood of some such disadvantage, which would put the bank on inquiry. In the present case, the transaction appears to the bank to be a normal commercial transaction with a businessperson who could be expected to understand the documents he has signed.
As the cases below show, the result would be different if the bank knew of Y's special disability, and took unconscionable advantage of it.