A mortgage is a security interest in the real property held by the lender as collateral for the debt, usually borrowing money. A mortgage itself is not a debt, it is a creditor's guarantee for debt. This is a transfer of interest on the land (or equivalent) of the owner to the mortgage lender, provided that this interest will be returned to the owner when the mortgage requirements have been fulfilled or performed. In other words, a mortgage is a guarantee for a loan the lender gives to the borrower.
The word is a French law term meaning "promise of death," originally referring only to the Welsh mortgage ( see below ), but in the late Middle Ages applied to all gages and reinterpreted by people's etymology which means that the pledge ends (died) either when the obligation is met or the property is taken through foreclosure.
In most jurisdictions, mortgages are strongly associated with loans obtained from real estate and not on other properties (such as ships) and in some jurisdictions only mortgageable land. Mortgages are the standard method in which individuals and businesses can buy real estate without paying full value directly from their own resources. View mortgage loans for residential mortgage loans, and commercial mortgages for loans against commercial property.
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Peserta dan terminologi varian
The legal system in different countries, while having several concepts in common, uses different terminology. However, in general, mortgage property involves the following parties. The borrower, known as the mortgagor, gives the mortgage to the lender, known as the mortgagee.
Lenders/mortgagee
Mortgage lenders are investors who lend money on mortgage guarantees on real estate. In today's world, most lenders sell the loans they write on the secondary mortgage market. When they sell a mortgage, they earn an income called Service Release Premium. Typically, the purpose of the loan is for the borrower to buy the same real estate. As a mortgage, the lender has the right to sell the property to pay off the loan if the borrower fails to pay.
Mortgage goes by land, so even if the borrower transfers the property to someone else, the mortgagee still has the right to sell it if the borrower fails to repay the loan.
So the buyer can not buy the property unwittingly into a mortgage, registered mortgages or recorded against a position with a government office, as a public record. The borrower has the right to have a mortgage excluded from the title after the debt is paid.
Borrower/mortgagor
Mortgagor is a borrower in the mortgage - he owes the obligations guaranteed by the mortgage. Generally, the borrower must meet the terms of the principal loan or other obligation to redeem the mortgage. If the borrower fails to meet these requirements, then the mortgagee can close to get back the unpaid loan. Usually borrowers will become homeowners, landlords, or companies who buy their property through loans.
Other participants
Due to the complicated legal exchange, or transport, of the property, one or both of the major participants tend to require legal representation. Agents used for transport vary by jurisdiction. In the English-speaking world it means a common law practitioner, ie lawyer or lawyer, or in a jurisdiction affected by English law, including South Africa, an introduction (licensed). In the United States, real estate agents are the most common. In the jurisdiction of civil law, directives are handled by notary civil law.
Due to the complex nature of many market the borrower may approach a mortgage broker or financial adviser to help him or the right lender source, usually by searching for the most competitive loan.
The instrument of debt, within the jurisdiction of civil law, is referred to by some Latin form of hypotheca (eg, Sp hypoteca , Fr hypothÃÆ'¨que , Germs Hypothek ; En hypothec ), and the parties known as hypothecators (borrowers) and hypothecatee (lenders). Hypotheses of civil law exactly match the UK mortgage with lawsuits or mortgage mortgages of America.
Maps Mortgage law
History
Anglo-Saxon and Anglo-Norman Law
In Anglo-Saxon England, when interest loans are illegal, the primary method of securing realty is with wadset (ME wedset ). Wadset is a masked loan as the sale of land under the right of return. The borrower (reverser) submitted by a simple real estate charter, in consideration of the loan, to the wadsetter who at redemption will reunite the property into an inverse by a second charter. The difficulty with this arrangement is that wadsetter is the absolute owner of the property and can sell it to a third party or refuse to reconstruct to the inverting, which is also stripped of its principal repayment and therefore in a weak position. In recent years, the practice - especially in Scotland and on the continent - is to do together wadset and a separate backbone according to the reversal of in personam in personam.
Alternative practices imported from Norman's law are property real estate pledges known as land tenure . Under the borrower's measure (gagor) convey ownership but not ownership to the lender (gagee) for an indefinite period of time until redemption. The gauge comes in two forms:
- the living gage (Norman
, Welsh prid ), where rent of land, profit, to reduce debt (i.e., the debt redeemed itself); - gauge die (Norman mort gage , Scots deid wad ), where rents and profits are taken as a replacement for interest but do not reduce the debt.
The gauge does not appeal to the lender because the gagor can easily issue a gagee using a disseysin novel, and gagee - just seize the "i de vadio" as a gage "- can not bring a voting solution to restore the property. Thus, the unfavorable live gauge fell from usage, but the death gauge continued as a Welsh mortgage until it was abolished in 1922.
The Middle Middle End
In the thirteenth century - in the UK and on the continent - its measurers were limited to a period of years and contained a provisional foreclosure (pactum commissorium ) provided that if after the debt period was not repaid, the title was released to the creditor, ie the annual term will expand automatically into a modest cost. This is known as shifting fee and enough after 1199 entitles the gagee to take a restoration action. However, the royal court increasingly disrespects the cost of shifting because there is no livery of seisin (ie, no formal means of conveyance), nor does it recognize that ownership can be enlarged, so in the 14th century the simple gauges for many years are invalid in England. (and Scotland and the near continent).
The solution is to incorporate wadets and gage over the years into a single transaction embodied in two instruments: (1) the absolute transfer (charter) in payment or over the years to the lender; (2) an indenture or bond defeasance which pronounces the loan and provided that if it is repaid the land will be reinvested in the borrower, otherwise the creditor will defend the right. If paid on time, the lender will reinvest his/her rights by using the deed of reconciliation. This is a mortgage with the transport (aka mortgage in fees ) or, when written, a mortgage with a charter and a filing back and takes the form of a feoffment, bid and sale, or lease and release. Because the lender does not need to enter into ownership, have the right of action, and promise repayment rights to the borrower, the mortgage is the guarantee of the right collateral. Thus, the mortgage on his face is an absolute diversion of the simple real cost, but in fact conditional, and will have no effect if certain conditions are met.
The debt is absolute in form, and unlike the measure does not depend on its payments solely from raising and selling crops or livestock or simply providing crops and livestock raised on clogged soil. The installment debt remains in effect whether the land succeeds in generating enough income to repay the debt. In theory, the mortgage does not require any further steps to be taken by the lender, such as the receipt of crops and livestock in repayment.
Renaissance and after
However, if the borrower is one day late in paying off the debt, he loses his land to the lender while still remaining responsible for the debt. More and more equity courts are beginning to protect the interests of the borrower, so the borrower comes under Sir Francis Bacon (1617-21) the absolute right to demand redemption at redemption even if it matures. This borrower's right is known as the equity of redemption.
This arrangement, in which the lender in theory is the absolute owner, but in practice has little practical ownership rights, seen in many jurisdictions as artificial awkward. By law the position of common law is changed so that the borrower (borrower) will retain ownership, but the rights of the borrower (lender), such as foreclosure, sales force, and the right to take ownership, will be protected. In the United States, countries that have reformed the nature of mortgages in this way are known as lien countries. A similar effect was reached in England and Wales by the Law of Property Act 1925 , which abolished a mortgage for a modest charge.
Since the 17th century, lenders have not been allowed to bring interest in property beyond the underlying debt under the principle of equity (redemption). Attempts by lenders to bring equity interests in property in a manner similar to convertible bonds through contracts have been beaten by the courts as "clogs", but developments in the 1980s and 1990s have led to a less rigid enforcement of this principle, mainly because interest among theorists to return to the freedom of the contract regime.
Default on shared property
When a tractate of land is purchased with a mortgage and then broken up and sold, "reversed rules reversed rules" apply to sever those responsible for unpaid debts.
When a tractate of mortgaged land is broken up and sold, by default, the mortgaged person first seizes the land still owned by the mortgagor and proceeds of the sale to the other owner in the 'reverse order' on which they are sold. For example, Alice acquired 3 acres (12,000 m 2 ) many by mortgage then split the lot into three 1-acre (4,000 m 2 ) many (X, Y, and Z) , and sells a lot of Y to Bob, and then lots Z to Charlie, retaining lots of X for himself. After the default, the pawned person proceeds against the X lot first, the mortgagor. If the foreclosure or repossession of lot X does not fully fulfill the debt, then the mortgage goes on against lot Y (Bob), then lot Z (Charlie). The reason is that the first buyer must have more equity and the next buyer receives a diluted part.
Legal aspects
Mortgages can be legitimate or equivalent. Furthermore, the mortgage may take one of a number of different legal structures, the availability of which will depend on the jurisdiction in which the mortgage is made. The jurisdiction of common law has evolved two major forms of mortgage: mortgage with death and mortgage on legal charges.
Mortgage with demise
In a mortgage by death, mortgagee (lender) becomes the owner of the mortgaged property until the loan is repaid or other mortgage liabilities are met in full, a process known as "redemption". This type of mortgage takes the form of delivering property to the creditor, provided that the property will be returned at redemption.
Mortgages by death are the original form of mortgage, and continue to be used in many jurisdictions, and in a small minority of countries in the United States. Many other common law jurisdictions have removed or minimized mortgage use by death. For example, in England and Wales, this type of mortgage is no longer available in relation to land-based interests, under section 23 of the Land Registration Act 2002 (though still available for unregistered interest).
Mortgages with legal charges
In a mortgage on a legal or technically charged "charge by a deed declared by way of legal mortgage", the debtor retains the rightful owner of the property, but the creditor obtains sufficient rights therefor to enable them to enforce their security, such as the right to own property or sell it.
To protect lenders, mortgages with legal fees are usually recorded in the general register. Since mortgage debt is often the greatest debt held by debtors, banks and other mortgage lenders run a search for real estate property titles to ensure that no mortgages are already listed on the property of the debtor who may have a higher priority. Pawn taxes, in some cases, will come before the mortgage. For this reason, if the borrower has a property tax in arrears, the bank will often pay it to prevent the lienholder confiscating and removing the mortgage.
This type of mortgage is most common in the United States and, since the 1925 Property Act, it has become a regular mortgage form in England and Wales (now the only form for registered interests on the ground - see above).
In Scotland, mortgages with legal charges are also known as Security Standards.
In Pakistan, a mortgage with a legal charge is the most commonly used way by banks to secure financing. This is also known as a registered mortgage. After registration of legal fees, bank lien is recorded in the land register stating that the property has a mortgage and can not be sold without obtaining NOC (No Objection Certificate) from the bank.
Fair Mortgage
A fair mortgage comes from the Common Law UK and may not have legal formalities.
In a fair mortgage the lender is guaranteed by taking ownership of all the original title documents from the property and by the borrower signing the Memorandum of Deposit of Title Deed (MODTD). This document is carried out by the borrower that he has kept the title document with the bank with his own will and willingness, to secure the financing obtained from the bank. Certain transactions are recognized therefore as a mortgage by equity, which is not so well recognized by common law.
Foreclosure and non-recourse lending
In most jurisdictions, lenders can cover up mortgaged property if certain conditions - in principle, not paying for a mortgage loan - apply. Subject to local legal requirements, the property can then be sold. Any amount received from the sale (net of cost) is applied to the original debt.
In some jurisdictions especially in the United States, mortgage lending is a non-recourse loan: if funds obtained from the sale of mortgaged property are not enough to cover the debt, the lender may not ask for help to the borrower after foreclosure. In other jurisdictions, the borrower remains responsible for the remaining debt, through the assessment of the shortfall. In some jurisdictions, the first mortgage is a non-recourse loan, but the second and the next is a recourse loan.
Specific procedures for foreclosure and sale of mortgaged property are almost always applicable, and may be strictly regulated by the relevant government. In some jurisdictions, foreclosures and sales can happen very quickly, while elsewhere, foreclosures may take months or even years. In many countries, the ability of lenders to confiscate is very limited, and the development of the mortgage market has become slower. The relatively slow, expensive and complicated judicial seizure process is the primary motivation for the use of a trust deed, due to their provision for non-judicial seizure by the trustee through a "sales force" clause.
Mortgages in the United States
Security type of interest in realty
Three types of security over real property are commonly used in the United States: property rights, mortgages, and deeds of trust. In the United States, these security instruments proceed from debt instruments made in the form of promissory notes and known as mortgage notes, lender records, or lien records of real estate.
Mortgage
A mortgage is a security interest in realty created by a written instrument (traditionally a deed) that either conveys legal titles or mortgage titles in a non-profit lien way to a lender for performance under the terms of mortgage letters. In a little less than half the country, mortgages create lien over ownership of mortgaged property. The seizure of the lien almost always requires litigation stating that the debt is due and in default and ordering the sale of the property to repay the debt. Many mortgages contain a buy-sell clause, also known as a non-judicial seizure clause, making them equivalent to a trust deed. Most "mortgages" in California are actually trustworthy acts. The effective difference is that the foreclosure process can be much faster for a deed of trust than for a mortgage, on the order of 3 months rather than a year. Because these foreclosures do not require action by the courts, transaction costs can be considerably less.
Trust deed
A trust deed is a title submission made by the borrower to the trustee (not the creditor) for the purpose of securing the debt. In a lien-theory state, it is reinterpreted as simply imposing a lien on the title and not the title transfer, regardless of the term. This is different from a mortgage in that case, in many states, it can be taken over by an unofficial sale held by a trustee through a sales force. It is also possible to close them through the judicial process.
The act of trust to secure debt payments should not be confused with a trust instrument sometimes called a trust deed but which is used to create trust for other purposes, such as housing planning. Although there are superficial similarities in form, many countries that have a trust deed to secure debt payments do not create the correct trust arrangements.
Security certificate
The so-called deed to secure debt is a security instrument used in the state of Georgia. Unlike a mortgage, the deed of guarantee is a real sacrifice of real property - without redemptive equity - in debt security. After the implementation of a deed, the right to transfer to the grantee or beneficiary (usually the lender), but the giver (the borrower) retains an equal right to use and enjoy the submitted land subject to compliance with the debt obligations.
Security actions should be recorded in the area where the land is located. Although there is no specific time in which such acts should be filed, failure to record timely deeds to secure debt may affect priority and therefore the ability to enforce debt on the subject property.
Title theory vs. lien theory
In the United States, more states are theoretical states than title theorists. In the title-theory countries, mortgages continue to be the legal title submission to secure debt, while mortgagor still retains a fair degree. In the lien-theoretical state, mortgages and deeds of trust have been redesigned so that they now enforce liens that have no rights to ownership of mortgaged property, while the mortgagor still holds a legitimate and equal title.
Priority
Lien is said to attach a title when the mortgage is signed by a mortgagor and sent to mortgagee and mortgagor receive funds whose mortgage payments secure. Subject to the requirements of the state registration law under which the mortgaged property lies, this annex sets the mortgage lien priority in relation to most other liens on property rights. Lien who has attached to the title before the mortgage lien is said to be senior, or before, mortgage lien. Those who attach afterwards are said to be junior or subordinate. The purpose of this priority is to establish the order in which the liens holders have the right to confiscate their liens to recover their debts. If the property title has some mortgage lien and the secured loan with the first mortgage paid off, the second mortgage mortgage will rise in priority and become the first new mortgage lender on the title. Documenting this new priority setting will require the release of the mortgage to get the loan in full.
Task
Mortgages, together with Mortgage notes, may be given to other parties. Some jurisdictions argue that the assignment of the letter implies mortgage assignments, while others argue that it only creates a just right.
See also
- Hypothesis
- Loan service
- Trust Guard
- Bridge financing
- Funding
- fixed rate mortgages
- Promissory note
- The origin of the credit
- Subprime Loans
- Mortgage calculator
- Mortgage Credit Guidelines
- Refinancing
- Foreign currency creditors
- Americans for Justice in Lending
- National Mortgage News
- Mortgage insurance
- Liability on loanable securities - CMO
- Subprime mortgage crisis
- MortgageLoan
References
Source of the article : Wikipedia
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