Professional Documents
Culture Documents
Mortgagor
Introduction
Nowadays mortgage is a very commonly used word. Every single person has
the knowledge that if he wants a loan to be sanctioned, he has to pay some
collateral and for that, he has to mortgage his property with a bank. Mortgagor
and mortgagee are the parties who have an important role to play during
mortgage of a property. Various statutes available in India deals with a
mortgage. Following legislation deal with mortgage:
Who is a mortgagor?
The person who has transferred the interest in a specific immovable property is
known as mortgagor. For instance, A wants a loan from B. Now B wants his
amount to be secured which he is going to loan A. A will transfer the interest in
a specific immovable property to B and will give him the authority of selling it in
case A is not able to repay B’s amount. Here A is the mortgagor.
Who is a mortgagee?
The transferee or person in whose favour the interest is being transferred is
known as mortgagee. In the above-given example, the person who is lending
money i.e. B is the mortgagee.
What is mortgage-money?
The principal amount which is given as loan and the interest amount which
mortgagor will pay to mortgagee along with the principal amount. Sum of both
the principal amount and interest is known as mortgage-money.
1. Right to redemption
2. Right to transfer mortgaged property to a third party instead of
retransferring
3. Right of inspection and production of documents
4. Right to accession
5. Right to improvements
6. Right to a renewed lease
7. Right to grant a lease
By operation of law
All conditions in the lease should be according to the local laws and
customs to prevent any fraudulent transaction.
No rent or premium shall be paid in advance or promised by mortgagee.
The contract shall not contain any provision for the renewal of the lease.
Every such lease shall come into effect within a period of six months from
the date of its execution.
Where the mortgaged property is a building, the term of the lease should
not exceed three years in total.
Duties/liabilities of a mortgagor
Along with the rights given to a mortgagor, the Transfer of Property Act has
also conferred some duties on him. Following are the duties of a mortgagor:
Conclusion
A mortgage-deed comes up with many rights and liabilities for both the parties
involved i..e. mortgagor and mortgagee. These rights and liabilities were
created and included in the Transfer of Property Act in 1882 which is quite old
and therefore is outdated. Though amendments were made in the Amendment
Act of 1929, but no recent amendments have been made in the chapter of
rights and liabilities of mortgagor. This has lead to various fraudulent
transactions as both the mortgagor and mortgagee has found various new
methods of deceiving each other. Therefore, the need of the hour is to amend
the laws and make it more stringent so that no party attempts to enter in
fraudulent transactions.