Mortgage is a kind of real estate loan liability provided by the banks as made as an act of favour by the banks or loan lenders. Given you to assist the finance of our your own house of dreams by the banks or the one who lends you mortgage.
Lets understand this with an example –
You lent some money to someone on the trust he will return, but if that person is unable to return that money on time. Then there are so many ways to bring you your money back, like you can file a suit against him.
But think of such a rare situation once that the person you have lent the money.
That person goes bankrupt he has a huge loss of money, from where he himself invested.
In such case, regardless of what the person has promised you or you filed a suit against him .
You can not get your money back in any case. In such a situation you will have to face a very big loss.
So here i am going to tell you what to do in this way-
So you can keep some of his very important assets which he owns as MORTGAGES with you.
By this method you can recover your money without any problem.
So whatever you take from him instead of money are known as MORTGAGES.
The person who has kept his assets with you as mortgages is known as MORTGAGOR.
And you being the person/bank who kept his assets as mortgage known as MORTGAGEE..
And the whole process of giving money instead of assets is known as MORTGAGE MONEY.
In India, according to section 58-59 “Transfer of Property Act,1882” says that mortgage is transfer of an interest instead of money.
Types of Mortgages
Officially according to section 58 there are many ways to take your given mortgage back.
So now here we will try to understand that how many types of mortgages are there .
So there are three types of mortgages at present :
- Simple Mortgage
By this method you don’t simply transfer his assets that were kept as mortgages and you also have a power to create a mortgage deed that if he /she fails to repay you your given money so you have all right to sell his mortgage property but under rules of section 58-59 “Transfer of Property Act 1882”.
2. Mortgage by Conditional Sale :
Mortgage property is ostensibly sold this means that the property is sold completely but there are some points in this written under the mortgage deed are :
- If the mortgagor has returned you your money back in the given time period so the sale will be completely Void.
- If the mortgagor fails to return you your money back so the sale will be completely Absolute.
Signing a Foreclosure :
When you will receive a mortgage you will have to sign some legal documents known as a “Mortgage Note” that ensures you will repay the whole balance of your mortgage, with interest.
If you proved as a welsher on your mortgage payments, the lender or MORTGAGEE is allowed to take back your house and sell it. This judicial process or litigation is known as a “Foreclosure”.