RESEARCH TITLE

SIMPLE MORTGAGE

CHAPTERIZATION
page no.
01.Literature Review
02.Research Objectives
03.Introduction
04.Research Hypothesis

LITERATURE REVIEW
01.T&P ACT by DR. AVTAR SINGH
02. T&P ACT by DR. S.N.SHUKLA
03. T&P ACT by SIR D.F.MULLA
04. T&P ACT by P.S.NARAYANA
05. T&P ACT by N.NANDI
06. T&P ACT by R.K.SINHA

RESEARCH OBJECTIVES

INTRODUCTION
WHAT IS MORTGAGE?
Mortgage in Transfer of Property Act, 1882
Mortgage is a loan taken by buyer from the loan giver against his or her property.
Generally, a mortgage is the transfer of an interest in property to a lender as a
security for a debt usually a loan of money. 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 property
from the buyer to the mortgage lender, on the condition that this interest of
property will be returned to the giver/buyer when the terms of the mortgage have
been satisfied or performed. Section 58(a) of The Transfer of Property Act, 1882
defines, A mortgage is the transfer of an interest in specific immoveable property
for the purpose of securing the payment of money advanced or to be advanced by
way of loan, an existing or future debt, or the performance of an engagement
which may give rise to a pecuniary liability. The transferor is called a mortgagor,
the transferee a mortgagee; the principal money and interest of which payment is
secured for the time being are called the mortgage- money, and the instrument
by which the transfer is affected is called a mortgage- deed. Therefore, it means
that the following essential attributes should be confirmed to make a valid
mortgage:
Transfer of interest on specific immoveable property
Consideration, or
Security either to pay loan advanced/ to be advanced ,or
Must be a debt creates at present or will be in future, or
Give rise to a pecuniary liability1
Transfer of interest on specific immoveable property:
The transfer of property act deals only the immoveable property and must be
specific but there have certain exceptions where moveable property can be a part
of mortgage property, like in the modes of hypothecation (Co-operative
Hindustan Bank Vs Surendra Nath,1932,CAL 426). Therefore, it cannot be
said that the mortgage of moveable property is forbidden (Halim, 2006)2
1
2

Bindras.N.S. Conveyancing, Delhi Law House,1953(Re Print 2012)

Halim, Md Abdul. A Guide to Conveyancing and Legal Drafting, CCB Foundation, 2006

Consideration/Security either to pay loan advanced or to be advanced:

There must be some consideration to secure the performance of a contract .The
consideration may be either by money advanced or to be advanced by way of
loan, or in consideration of an existing debt or further debt which going to create,
or in consideration of performance or an engagement giving rise to monetary
liability.

TYPES OF MORTGAGE
1)
2)
3)
4)
5)
6)

Simple mortgage
Mortgage by conditional sale
Usufructuary mortgage
English mortgage
Mortgage by deposit of title- deeds.Anomalous mortgage

Simple Mortgage
Where, without delivering possession of the mortgaged property, the
mortgagor binds himself personally to pay the mortgage money, and agrees,
expressly or impliedly, that, in the event of his failing to pay according to his
contract, the mortgagee shall have a right to cause the mortgaged property to
be sold and the proceeds of sale to be applied, so far as may be necessary, in
payment of the mortgage- money, the transaction is called a simple mortgage
and the mortgagee a simple mortgagee. Therefore, the essential attributes of
simple mortgage are:
No transfer of possession
Mortgagor binds himself to pay the mortgage money
In case of failure by mortgagor, the mortgagee will have the right to
sell.

Mortgage by conditional sale

Mortgagor seems to sells the mortgaged property with a simple condition of
default
Deemed a mortgage, except the condition is embodied in the document, which

effects or purports to affect the sale Where the mortgagor ostensibly sells the
mortgaged property- on condition that on default of payment of the mortgagemoney on a certain date the sale shall become absolute, or on condition that on
such payment being made the sale shall become void, or on condition that on
such payment being made the buyer shall transfer the property to the seller, the
transaction is called a mortgage by conditional sale and the mortgagee a
mortgagee by conditional sale Provided that no such transaction shall be deemed
to be a mortgage, unless the condition is embodied in the document which effects
or purports to effect the sale. Therefore the essential attributes of mortgage by
conditional sale are:

Usufructuary mortgage
Where the mortgagor delivers possession or expressly or by implication binds
himself to deliver possession of the mortgaged property to the mortgagee, and
authorizes him to retain such possession until payment of the mortgage- money,
and to receive the rents and profits accruing from the property, or any part of
such rents and profits and to appropriate the same in lieu of interest, or in
payment of the mortgage- money, or partly in lieu of interest or partly in
payment of the mortgage- money, the transaction is called an usufructuary
mortgage and the mortgagee an usufructuary mortgagee. Therefore the essential
attributes of usufructuary mortgage are:
Mortgagee has absolute right to enjoy the rents and profits until loan is
paid through enjoyment
No forfeiture,
No foreclosure and
Not allowed to sale

English mortgage
Where the mortgagor binds himself to repay the mortgage- money on a certain
date, and transfers the mortgaged property absolutely to the mortgagee, but
subject to a proviso that he will retransfer it to the mortgagor upon payment of
the mortgage, money as agreed, the transaction is called an English mortgage.
Therefore the essential attributes of English Mortgage are

Mortgagor binds himself to pay mortgaged money on certain day

Mortgage property is absolutely transferred to the mortgagee
Mortgagor entitled to reconveyance on payment of debt.

Mortgage by deposit of title- deeds.

Where a person in the town of Dhaka, Narayangonj and Chittagong and in any
other town which the Government may, by notification in the official Gazette,
specify in this behalf, delivers to a creditor or his agent documents of title to
immoveable property, with intent to create a security thereon, the transaction is
called a mortgage by deposit of title- deeds. Essential attributes of Mortgage by
deposit of title are:
Mortgagor transfer his/her title deeds
Interest on property is transferred to the mortgagee

Anomalous mortgage
A mortgage which is not a simple mortgage, a mortgage by conditional sale, an
usufructuary mortgage, an English mortgage or a mortgage by deposit of titledeeds within the meaning of this section is called an anomalous mortgage.
Essential attributes of Anomalous Mortgage are
Mortgage should not be fallen on any one of the above mentioned criteria
Some features may be combined but not the same of anyone of this above
mentioned.

SIMPLE MORTGAGE
Introduction
According to Section 58 of the Transfer of Property Act, 1882, a mortgage is the transfer
of an interest in specific immoveable property for the purpose of securing the payment of
money advanced or to be advanced by way of loan, an existing or future debt or the
performance of an agreement which may give rise to pecuniary liability. [1]