Meaning of Mortgage :

 A mortgage is the transfer of an interest in specific immovable property to secure the payment of

funds or to be advanced through a loan, an existing or future loan, or the performance of an
engagement that may give rise to a pecuniary liability.

 A mortgage is a loan that a borrower uses to buy or maintain a home or other type of property for
sale and that you agree to repay over time, usually in a series of regular payments. The property
serves as collateral for a loan.
 The Rights and liabilities arise during the mortgage period. Loans can be secured or unsecured.
When a loan is repaid on the basis of a debtor's commitment to repay the debt, it is called an
unsecured loan. However, when a creditor seeks a loan from a creditor to repay a loan, the loan is
known as a secure loan. One of the best ways to protect yourself from debt is to borrow money.

 Section 58 (a) of the Transfer of Property Act, 1882 , defined mortgage as the transfer of interest in a
specific immovable property for securing : –
 The money given to him should be paid or given through loan, or
 A current or future debt, or
 Performing an engagement that can lead to an pecuniary liability.

Characteristics of Mortgage :

 Following are the characteristics of mortgage :

1. A mortgage can only be affected by immovable property :

o Immovable property includes land and profits from land-related assets such as trees, buildings
and machinery.
o But a non-permanent machine that can move from one place to another is not considered
immovable.

2. A mortgage is the transfer of interest on a fixed immovable property different from an auction. As
for sale the copyright of the property is transferred but in the hold a certain copyright is transferred
and the other copyright will only be to the owner.

3. The purpose of the transfer of interest on the property may be to obtain a loan, resulting in a loan
obligation. A transfer of assets for a purpose other than the above will not be a loan.
Example: An asset transferred to settle previous debts will not be a loan.
4. Borrowed property must be an object, that is, which can be determined by its size, location,
boundaries, etc.
5. The actual availability of the borrowed property should not always be transferred to the mortgage.

6. The landlord will repay the interest on the foreclosed property after payment of the loan.

7. If the real estate agent fails to repay the loan, the borrower is entitled to repay the mortgage on the
mortgage.
Who is a Mortgagor?

 Meaning of Mortgagor :  A mortgagor is the person who borrows money from a lender in order
to purchase a home or other piece of real estate. The person who has transferred interest to a
specific immovable property is known as a mortgagor.
 A mortgagor is a person who borrows money from a lender to buy a house or an apartment. A
person who transfers interest on a fixed amount is known as the lender.

 For Example : ‘A’ wants a loan from ‘B’. Now ‘B’ wants his money to be secured which he is
giving in loan to ‘A’. ‘A’ will transfer interest in the specific immovable property to ‘B’ and give him
the right to sell the property in case ‘A’ is not able to repay the amount. ‘A’ is the mortgagor here.

 Meaning of mortgage money :– The principal amount which is given as loan and the interest
amount that the mortgagor will pay. The sum of both, the principal amount and interest is known
as mortgage money.

 Meaning of mortgage deed :– This is the means by which the transfer of interest in a specific
immovable property is affected. It is a type of agreement that legally binds both the mortgagor
and the mortgagee.

 Who is a Mortgagee?
A mortgagee is an individual or entity that lends money to a borrower for the purchase of real
estate. In short, the mortgagee is the lender. Mortgage financing is commonly used all over the world, as
people use it to finance the purchase of a house, office, or real estate property for any other use.
From the perspective of the mortgagee (lender), he creates a priority legal interest in the value of the
property, and it protects the lender in case the borrower is unable to repay the loan in full or defaults.
In several cases, lending is done through financial institutions, and the mortgagee represents the
interests of the financial institution that lends the money. It is the mortgagee’s responsibility to measure
the financial risk of mortgagors (borrowers) and to develop lending packages and terms accordingly.
 For Example, S loans G, S wants her amount to be secured. For that, G has transferred an
interest in his immovable property to S. G authorizes S to sell his property in case of loan
default. Here, S is the Mortgagee, and G is the Mortgagor.

Lender = Mortgagee.
Borrower = Mortgagor.

A mortgage is a person or business that borrows money from a borrower to buy property.
The borrower creates an important legal interest in the value of the property, and this protects the lender
in the event that the borrower is unable to repay the loan in full.
In several cases, lending is done through financial institutions and the mortgagee represents the interests
of the financial institution that lends the money to the other person.
 Rights of Mortgagee
The law regulates the rights of mortgagees to protect them in the event the mortgagor is unable to
re-pay. The lender has one right against the property and the other against the lender personally.
If the money is not recovered from the mortgagor within the stipulated time the borrower is
entitled with the right to recover from the proceed of the property, or
Mortgagee can sue the mortgagor for the recovery of the money that is borrowed. Listed below are
some of the essential rights of mortgagees :
 
1. Right to foreclosure (section 67)
 According to this section, if the term of the mortgagee has expired or at any time before the
foreclosure order is issued after the lender has been paid, the borrower may be able to redeem the
property or obtain a court order to sell the property.

 In the case of K. Vilasini v. Edwin Periera, AIR 2009 SC 104, it was noted that the transfer
order is only passed after determining the nature and nature of the loan and the parties operating
within the mortgage.

 The right of foreclosure is usually exercised when the mortgagor fails to pay the amount of debt
in the stipulated time period and also his right to redeem the property has also expired due to
default in his payment. Hence, the mortgagee can file a suit of decree to debar the mortgagor
from his redemption rights.

2. Right to sell (Section 69)

 According to this section, the borrower has the right to sell the mortgaged property without
having received any notice or order from the Court. When the landlord fails to repay the
mortgage money within a specified time period, the motgagee has the right to sell the property to
repay the mortgage without the court's intervention.

 But there are only certain conditions where the co-owner has the right to sell the property
without the consent of the Court.

 Power of Sale when valid :

Section 69 of the Transfer of Property Act, 1882 states, a borrower has the power to sell a
borrowed property without the intervention of a court, for failing to pay a mortgage by mortgagor on
three counts:

1. Where the mortgage is an English Mortgage and the mortgagor and mortgagee are not Muhammadan,
Hindus,Buddhist or any member of any race, sect, tribe or as they are stated by the official gazette of the
State government.

2. When the government is mortgagee, within the express provision of sale without intervention of the
court. i.e Where this power of mortgagee is explicitly stated by the mortgagee in the mortgage deed
itself and the mortgagee is itself government.

3. When the mortgaged property is located or situated in specified towns at Calcutta, Madras, Bombay
or any other gazette town or area.
 
3. Right to sue (Section 68)

 The mortgagee has the right to sue the mortgagor in the following cases to get his mortgage money
back :-

 Where the mortgagor is bound personally himself to pay the debt

 In case where the mortgaged property is completely or partially destroyed without any
fault of them mortgagee
 In case where the mortgagee is deprived from the whole or part of the security by any
faulty act of the mortgagor
 In specific mortgage, where the borrower is entitled to collateral but the partner fails to do
so.

 The Court can put a stay on all the suit and proceedings according to the suit filed by the mortgagee
until the mortgagee competes all its remedies or abandons the security property and if decided in
favour of mortgagor, re-transfers the property.

4. Right to sale without court intervention

 The right to sale without the intervention of the court allows the mortgagee to sell the property
without informing the courts under certain conditions.

 For Example : One such condition could be if the mortgagor defaults and is unable to service the
payment after three months of being served a notice.

5. Right of mortgagee to spend money (Section 72)

 The right to spend money allows the mortgagee to spend money on the property for purposes such as
for the preservation includes repairs of the mortgaged property and also from forfeiture, sale, or
destruction. The mortgagee can add the money spent by him on the property to the mortgage money
due to him and is entitled to receive interest on the amount at the same rate as applies to the principle
money.

 This section applied on the mortgagee only when the property is in the possession of the mortgagee
and the mortgagee has the right to spend money on the mortgaged property if he finds it is necessary
and unless there is contract contrary to that.

6. Right to the accession of the mortgaged property (Section 70)

 Accession are the additions made to the mortgaged property as stated above, and this section
mentions that after the date of execution of the mortgage deed if any additional costs are made to the
property, then even the mortgagee shall have its rights over those accessions for the purpose of its
security of his mortgage money.
 This is section is quite the opposite of section 63 where the mortgagor has the right over any
accession made by mortgagee, but under the section the mortgagee can claim over the acquired
accession as part of the security only enforce his authority on them.
 The right to the accession of the mortgaged property allows the mortgagee to retain any additions to
the property as security.
 For Example : If the mortgagor builds a building on a land that has been mortgaged, the
mortgagee can retain the building as security for the loan.
 

7. Right of possession
  The mortgagee also have the right of possession under which he or she receives ownership of the
property if certain rules are not met.

8. Right to renewal of lease of the mortgaged property (Section 71)

 As per Section 71, when the mortgaged property is under any lease and the mortgagor has renewed
the lease of the property that is been mortgaged, then even the mortgagee is or shall be entitled to the
all benefits of the renewed lease and consider it as part of security only unless anything contrary has
been stated in the contract.

 The following conditions are mentioned where the mortgagee can spend money :

 In case of destruction, forfeiture of property, the mortgagee may spend money to protect it.

 To support the title of the mortgaged property.

 For defending his own title over the mortgaged property against the title of the mortgagor.

 The mortgagee can also spend money to renew the lease of the mortgaged property.

 He can also insure the property if it is of insurable nature.

 Duties of Mortgagee :
 Section 76 elucidates the liabilities of Mortgagee in possession, and lists the following duties :

 Duty of mortgagee when the property is in his possession (Section 76)

 When the mortgaged property is in the hands of the mortgagee and during the ongoing of the
mortgage, the mortgagee is bound by the following liabilities as per this section :

 To manage the property well in manner of ordinary prudence.

 Duty to collect rents and profits of the property.

 To pay the government taxes due duly while the property is in his possession.

 To make the necessary repairs of the premises unless it is contrary to the contract.

 To not commit any action which may damage or deteriorate the value of the property
permanently.

 Duty to apply for insurance money for reinstating the property or in case he receives reduction in
mortgage money from the mortgaged property.

 To keep proper accounts of all the money received and the money spent by him over the
mortgaged property.

 Duty to apply for rents and profits for discharging the interests of principal amount and make
certain deductions.

 Duty to take necessary steps with his entire efforts to keep the property undamaged.

 Duty to carry out urgent and necessary repairs required in the property.

If the Mortgagee fails to perform any of the aforementioned duties, he will be charged for the losses that
are incurred.
 CONCLUSION
o With this in mind, we come to the conclusion of a long-running mortgage article in which we
learned the rights and liabilities of the mortgagor as well as mortgagee and that they both have
the same responsibility to care of the mortgaged property until the mortgage is discharged off.

o The mortgage deed comes with many rights and liabilities for both parties, namely the mortgagor
and mortgagee.. These rights and liabilities were stated in the very old Transfer of Property Act
1882.

o New amendments were also being made in the Amendment Act of 1929 which was not properly
enforced so there is a way in which both the borrower and the lender have different views of
deceiving each other. Therefore, the need for an hour is to amend the rules and make it harder so
that no party tries to get into counterfeit money.

o If the mortgage is necessary mostly people go for the financial institution which includes
banking as well as non financial institution as they are also governed by many other laws and
they don’t deceive the borrower as the laws are stricter for them.

o With the development of the Transfer of Property Act of 1882 the view regarding the rights and
liabilities of the mortgagor and mortgagee must be expanded.

o This saves them from the exploitation and protection of property that has been seized for
malicious purposes.

BIBLIOGRAPHY
1.https://timesofindia.indiatimes.com/bangalore/Rights-and-liabilities-of-
mortgagee/articleshow/1032141.cms

2.https://www.advocatekhoj.com/library/lawareas/mortage/rights.php?Title=Mortgage&STitle=Rights
%20and%20Liabilities%20of%20a%20Mortgagor

3. https://www.scribd.com/doc/315768089/mortgagor-rights-and-liabilities

4. https://blog.ipleaders.in/rights-liabilities-mortgagor-india/