SECONDARY MORTGAGE MARKET

Secondary Mortgage Market

Secondary Mortgage Market

What does MORTGAGE mean?

In word mortgage, mort- is from Latin phrase for death and -gage is from sense of that word significance the promise to forfeit certain thing of value if the debt is not repaid. So mortgage is literally the dead pledge. It was dead for two reasons, house was forfeit or "dead" to borrower if lend were not repaid and promise itself was dead if loan was repaid. In words of 17th year's English jurist (and evidently etymologist) Edward Coke:

A mortgage (Law French for "dead pledge") is an apparatus used to conceive the lien on genuine land parcel by contract. It is used as the procedure by which persons or enterprises can purchase residential or financial house without paying full worth upfront. The borrower (also called (mortgagor) values the mortgage to promise real house to lender (also called mortgagee) as security against liability (also called hypothecation) for rest of value of house (Pomykala, 2000).

Mortgage is liability equipment by which borrower (mortgagor) presents lender (mortgagee) the lien on house as security for repayment of the loan.

A mortgage is transfer of an interest in exact immovable house for reason of securing payment of money advanced or to be advanced by way of lends an existing or future liability, or performance of an engagement, which may give rise to the pecuniary liability. Thus against immovable house assigned as the mortgage, the debt or release of some obligation is secured.

Creation of Mortgage

Where principle money secured is one hundred rupees or upwards, the mortgage otherwise than the mortgage by deposit by title deeds can be affected only by the registered instrument signed by mortgagor and attested by at least two witnesses. When principle money secured is less than one hundred rupees, mortgage may be affected either by the registered instrument signed by mortgagor and attested as aforesaid, or (except in case of the simple mortgage) by delivery of property.

Different Types of Mortgages

There are 6 kinds of mortgages. They are Simple Mortgage, English Mortgage, Equitable Mortgage or Mortgage by Deposit of name Deeds, Usufructuary Mortgage, Mortgage by Conditional Sale, Anomalous Mortgage. The first three are common and remaining three are not.

Simple Mortgage

Where, without consigning possession of mortgaged house, mortgagor binds himself in person to pay mortgage-money, and agrees, expressly or impliedly, that, in event of his failing to pay according to his agreement, mortgagee will have the right to origin mortgaged house to be sold and advances of sale to be directed, so far as may be essential, in fee of mortgage-money, transaction is called the simple mortgage and mortgagee the simple mortgagee (Mann, 1997).

English Mortgage

Where mortgagor binds himself to repay mortgage-money on the certain designated day, and moves mortgaged house wholeheartedly to mortgagee, but subject to the proviso that he will re-transfer it to mortgagor upon fee of mortgage-money as acquiesced, transaction is called an English mortgage.

Equitable Mortgage or Mortgage by Deposit of Title Deeds

Where the individual in any of following villages, namely, towns of ...