Kinds of mortgage Part 1

May 20, 2008 2:46 am editor More Information

A mortgage must adapt to a household’s current financial situation and goals for the next years. This is why you should ask crucial questions before purchasing a mortgage. One of these is: What is the best type of mortgage for you? There are many kinds of mortgages:

Simple mortgage
Mortgage by conditional sale
Usufructuary mortgage
English mortgage
Mortgage by deposit of title deed
Anomalous mortgage

Simple mortgage – The mortgagor keeps the possession of the property as the security. He is responsible for the discharge of the debt. If he defaults to repay, he has the right to sell his mortgaged property to recover the loan.

Mortgage by conditional sale – The mortgagor sells the property to the mortgagee with the condition that the property will be restored to him by the mortgagee if the loan will be repaid. If the mortgagor couldn’t pay off the loan, the mortgagee owns the property. Because of its risky nature, bankers don’t consider this as a favorable security.

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