Q. 1 Define Mortgage under Transfer of Property Act 1882?

MORTGAGE:

Section 58 of the Transfer of Property Act, 1882 explicitly provides the concept of mortgage. The mortgage is a written agreement between the mortgager/debtor and a mortgagee/creditor. The mortgager/debtor is the owner of the property and on the other hand the mortgagee/creditor is the owner of loan. The mortgage transaction is successfully completed where a debtor or mortgager receives money from mortgagee in lieu of/exchange of moveable or immovable property as security.

DEFINATION OF MORTGAGE:

Provision of property by debtor to a creditor as a security against the loan received on the condition that it shall be returned by creditor on the payment of the debt within a stipulated time as agreed by both the parties in the mortgage agreement.”

Illustration:

“A” is a mortgagor who enters into a mortgage agreement    with “B”. “A” and “B” both mutually agrees that “B” will give loan to “A” in exchange of property as security and it will be returned when “A”  pay’s his debt to “B” in a month. If “A” fails to repay his debt to “B” in a certain period of time as mentioned in the agreement then as a result “B” may take the mortgaged property in place of loan.”

This FAQ prepared by Advocate Sadia Saman