Deed of Mortgage with Possession
The Tamil Nadu Registration Department guidance titled “Deed of Mortgage with Possession” provides a model deed for mortgaging property as security for a loan while transferring possession to the mortgagee. The source gives no government order number or issue date, although the deed template contains an execution-year reference to two thousand seventeen.
What the document covers
The Tamil Nadu Registration Department model deed records a loan secured by a mortgage in which possession of the property is given, or is agreed to be given, to the mortgagee. It contains blanks for the parties, loan amount, repayment period, notice period, property details, market value and registration details of the mortgagor’s title deed.
The deed identifies the borrower and property owner as the mortgagor, and the lender as the mortgagee. These terms also include their respective heirs, executors, administrators, legal representatives, nominees and assigns where the context permits.
Who may be affected
The model is relevant to a property owner borrowing money against property with possession, the lender taking the property as security, and anyone considering buying property that may be subject to such a mortgage. The deed requires the mortgagor to state that the property has a valid and marketable title and is free from any other mortgage, charge or encumbrance.
Main provisions
- The mortgage amount, payment method, repayment period and notice period must be entered in the deed.
- The mortgagee may demand repayment according to the completed terms. After repayment, the mortgage must be discharged and possession returned to the mortgagor.
- The mortgagor gives possession on execution or agrees to hand it over by a specified date.
- If the amount becomes payable, the mortgagee may exercise powers under the Transfer of Property Act, 1882, without losing the right to file a suit for sale of the property.
- Following due notice, the deed provides for sale of the property and conveyance to the purchaser.
- If sale proceeds do not cover the mortgage amount, the mortgagor must personally meet the balance from other properties.
- Any surplus remaining after costs and the loan amount are deducted must be paid to the mortgagor.
- The mortgagee agrees to pay property taxes and other charges regularly until the mortgage is discharged or possession is returned.
- A notice sent or left at the mortgagor’s address stated in the deed is treated as properly served.
Property description and signing
The property must be fully described in the schedule, and its current market value must be entered. The deed is signed by the mortgagor in the presence of witnesses.
This summary is generated from the source document to help you find what is relevant. The PDF above is authoritative. For advice on your own property, use LandLens One or speak to a qualified professional.
Common questions
Does the lender receive possession of the mortgaged property?
Yes. The deed records that the mortgagor either gives possession on the date of execution or agrees to hand it over by a specified date.
When does the owner get possession back?
The deed states that the mortgagee must discharge the mortgage and return possession when the mortgage amount is repaid.
What happens if the property sale does not cover the mortgage amount?
The mortgagor must personally make good the remaining balance from other properties. Any surplus after costs and the loan amount must instead be paid to the mortgagor.
Who pays property taxes while the mortgagee has possession?
The mortgagee agrees to pay taxes and other property charges regularly until the mortgage is discharged or possession is handed back to the mortgagor.
