Definition of Mortgage
A mortgage is a transfer of an interest in specific immovable property for the purpose of securing the debt. Section 58 of the Transfer of Property
Act
, talks about it.Elements of Mortgage
Three elements of a mortgage are:-
Parties in a Mortgage
There are two parties in a mortgage. They are:-
Types of Mortgage
There are six types of mortgage. They are:-
1.Simple Mortgage
Where without delivering the possession of the mortgaged property, the mortgagor personally binds himself to repay the loan. To secure the loan, the mortgagor transfers to the mortgagee the right to have sold immovable property if he fails to pay.
The elements of this mortgage are as follows-
The mortgagor must sell the immovable property
ostensibly
; means that it appears to be a sale, but in reality, it’s not a sale.In this, the possession of the property is delivered to the mortgagee and authorises him to receive rents and profits accruing from the property until the principal amount is satisfied. Here, mortgagor holds no personal liability in repaying the loan.
4.English Mortgage
It is a transaction in which the mortgagor binds himself to repay the mortgage money on a certain date and transfers the possession to the mortgagee. But subject to that on the payment of the loan, the possession will be re-transferred by the mortgagee to the mortgagor.
The mortgaged property is transferred absolutely to the mortgagee.
In England, a mortgage of this kind is called an equitable mortgage. In this mortgage, there is simply a deposit of document of title, and the loan is taken.
6.Anomalous Mortgage
It is a mortgage that is not mentioned anywhere. It means except above five mortgages mentioned above, all the mortgages are anomalous. This method is not mentioned explicitly but is in practice in India.
