Prajna Capital - An Investment Guide

This article explains what a mortgage is and outlines a few forms of mortgages Mortgage is a hypothecation of property to a bank. This is done as a security for a loan. A usual form of security that banks insist on is mortgage of the house for which the loan is being availed of by the borrower. The transferor is called a mortgagor, the transferee a mortgagee; the principal money and interest of which payment is secured are called the mortgage money, and the instrument by which the transfer is effected is called a mortgage deed. Under the Transfer of Property Act, Section 58 defines mortgage as the transfer of an interest in specific immoveable property for the purpose of securing either of these: Payment of money advanced or to be advanced by way of loan An existing or future debt The performance of an act which may give rise to a financial liability Mortgage of property gives the lender a right to acquire and sell the property in case of default by the borrower in repayment of either ...