Mortgage: A mortgage is a security interest in real property held by a lender as a security for a debt, usually a loan of money. According to Transfer of Property Act 1882, 58(a) defines, "Mortgage is the transfer of an interest in specific immovable property"
While a mortgage in itself is not a debt, it is the lender's security for a debt. It is a transfer of an interest in land (or the equivalent) from the owner to the mortgage lender, on the condition that this interest will be returned to the owner when the terms of the mortgage have been satisfied or performed. In other words, the mortgage is a security for the loan that the lender makes to the borrower.
Participants:
01. Mortgage lender:
A mortgage lender is an
investor that lends money secured by a mortgage on
real estate. The
borrower, known as the mortgagor, gives the mortgage to
the lender, known as the mortgagee. As the mortgagee,
the lender has the right to sell the property to pay off the loan if the borrower fails to pay.
02. Borrower:
A mortgagor
is
the
borrower
in
a
mortgage;
they owe
the
obligation secured by the
mortgage.
Generally, the
debtor must meet the conditions of the underlying loan or other obligation and the conditions of the mortgage. Otherwise, the debtor usually runs the risk of foreclosure of the mortgage
by the creditor to recover the debt. Typically the debtors will be the individual home-owners, landlords
or businesses who are purchasing their property by way of a
loan.