Registered vs Equitable Mortgage: Gain a better understanding of these important mortgage

Between Registered And Equitable

1.

What Does an Equitable Mortgage Mean?

Equitable mortgages operate per the guidelines outlined in Section 58(f) of the Transfer of Property Act.

2. Mortgage terms are mutually agreed upon by all parties involved.

What Does a Registered Mortgage Mean?

• Under this, the charge created on the property needs to be registered with the sub-registrar.

• The lender has the priority to recover dues using the mortgaged property over other creditors.

Distinctions Between These Mortgages

Registration Process

An equitable mortgage requires the filing of title deed deposits.

• The registered mortgage must be registered at the sub-registrar office.

Stamp duty

A registered mortgage carries a 5% stamp duty, and the overall process is somewhat complicated.

Risk involved

The risk of a fraudulent transaction from the borrower's end is significant with an equitable mortgage.

1.

Points to Remember About Equitable and Registered Mortgage

A registered mortgage necessitates proof of ownership.

2. Lenders typically prefer registered mortgages due to the security they provide.

In the eyes of lenders, registered mortgages are the safest way to lend because they give them priority during the recovery process.

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