A mortgage does not transfer ownership of the property; it merely transfers an interest (the secure right to recover money) while ownership remains with the mortgagor.
1. Kinds of Mortgages (Section 58)
- Simple Mortgage (Sec 58(b)): The mortgagor binds himself personally to pay, does not deliver possession, but agrees that in case of failure, the mortgagee has a right to sell the property through court.
- Mortgage by Conditional Sale (Sec 58(c)): The mortgagor ostensibly sells the property with a condition that upon repayment the sale becomes void, or upon default the sale becomes absolute. (Must be in a single document).
- Usufructuary Mortgage (Sec 58(d)): The mortgagor delivers possession to the mortgagee, authorizing them to retain it and receive rents and profits in lieu of interest or principal, until the debt is cleared. No personal liability exists.
- English Mortgage (Sec 58(e)): The mortgagor binds himself to repay on a certain date, and transfers the property absolutely to the mortgagee, subject to a proviso that the mortgagee will re-transfer it upon repayment.
- Mortgage by Deposit of Title Deeds / Equitable Mortgage (Sec 58(f)): Committed by delivering documents of title of immovable property to a creditor in notified towns with intent to create a security thereon. No registration required.
- Anomalous Mortgage (Sec 58(g)): A mortgage which is not any of the above five types (e.g., Usufructuary-Simple mortgage combined).
2. The Right of Redemption (Section 60)
The mortgagor has an absolute statutory right to redeem (recover) their property free from all encumbrances once the mortgage money has become due.
📜 Landmark Maxim: "Once a mortgage, always a mortgage" (Stanley v. Wilde, 1899)
Any provision in a mortgage deed which prevents the mortgagor from getting their property back upon payment of the debt is a Clog on Redemption and is completely void. Equity will not allow a mortgage to be converted into a sale or rendered virtually irredeemable.