| It is very important to understand difference between | | | | mortgage in case he fails to pay the mortgage money. |
| legal mortgage and equitable mortgage when | | | | The mortgagee is thus empowered to apply to the |
| considering any adverse credit mortgage advice. From | | | | court to convert the equitable mortgage into a legal |
| the point of view of transfer of title to the mortgaged | | | | mortgage if the mortgagor fails to pay the mortgage |
| property, mortgages are divided into two categories: | | | | money on the specified date. |
| legal mortgage and equitable mortgage. | | | | It is worth mentioning that a mortgage by deposit of |
| In the case of legal mortgage, the mortgagor transfers | | | | title deeds requires three ingredients: the existence of |
| legal title to the mortgaged property in favor of the | | | | a debt in the present or future, the deposit of title |
| mortgagee by a deed. In legal mortgage transfer of | | | | deeds, and an intention that the title deed should be the |
| legal title to the mortgage involves expenses in the | | | | security for the debt. The intention is indeed the |
| form of stamp duty and registration charges. On the | | | | essence of the transaction. An agreement of sale by |
| other hand, in case of an equitable mortgage, the | | | | itself does not create any interest in the property. |
| mortgagor transfers the documents of title to the | | | | Hence such an agreement is not deemed as |
| mortgagee for the purpose of creating an equitable | | | | Document of Title to property. For equitable mortgage, |
| interest of the mortgagee in the property. | | | | the deeds deposited must relate to the property or as |
| It means that legal title to the property is not passed on | | | | material evidence of title and must have been |
| the mortgagee, but the mortgagor undertakes, through | | | | deposited with the intention of creating a security |
| a Memorandum of Deposit, to execute a legal | | | | thereof. |