Taking out a mortgage

A mortgage of land is a transaction by which a borrower of money (the mortgagor) gives security for the loan to his lender (the mortgagee). The mortgagee then has certain rights against the land (e.g. a power of sale), by means of which he may raise any sums that become due to him from the borrower. He is not therefore, restricted to a merely personal action against the borrower, although he does enjoy that right as well as his remedies against the land itself.

Most mortgages are of a legal estate in land they are made by the freeholder or by a leaseholder. But a mortgage may be of an equitable interest in land. For example if land is settled on A for life with remainder to B in fee simple, it is possible for B to raise a loan of money by mortgaging his equitable interest in remainder under the settlement. It may be assumed that the discussion in the following pages is of mortgages of a legal estate unless the contrary is stated.