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Key differences between registered and equitable mortgage
The document outlines the key differences between registered and equitable mortgages, highlighting that equitable mortgages do not require registration while registered mortgages do. It emphasizes that registered mortgages involve a higher stamp duty and provide more legal security for lenders, making them less risky. Additionally, it notes that equitable mortgages, though quicker and with lower costs, pose greater risks to lenders.
Key differences between registered and equitable mortgage
- 1. Key differences between registered andequitable mortgage
- 2. What does equitablemortgage mean? × The lender and borrower mutually decide on the loan terms and conditions. 2
- 3. Understanding the workingof equitable mortgage × The borrower transfers the property title deed to the lender. × A charge is created on the mortgaged property. 3
- 4. What does aregistered mortgage mean? × Such a mortgage needs approval from the sub registrar's office. 4
- 5. Understanding the workingof registered mortgage × A charge on the property is to be created with the sub-registrar. × The title is restored to the borrower after the successful loan repayment. 5
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- 7. Registration and process ×An equitable mortgage does not require registration, but a registered mortgage does. × The equitable mortgage requires purchasing of stamp paper. × For a registered mortgage, you need to contact the sub-registrar office. 7
- 8. Mortgage cost × Stampduty for an equitable mortgage is between 0.1% and 0.2% of the property value. × Stamp duty for a registered mortgage is 5%. 8
- 9. Risk involved × Anequitable mortgage is riskier than a registered mortgage. 9
- 10. Points to considerwhen choosing between these two mortgages × The registered mortgage gives the lender more power than the borrower. × The registered mortgage is less risky as both parties are bound by a legal agreement. 10
- 11. Always remember that aregistered mortgage has a slight edge over an equitable mortgage. 11
- 12. 12 Thank You Would Loveto hear from you. Hero Fincorp Limited 09, Basant Lok, Vasant Vihar, New Delhi - 110057 Tel : 18001024145 Email : customer.care@herofincorp.com Website : https://www.herofincorp.com/ Know More : Equitable Mortgage vs. Registered Mortgage: Know the Difference