Equitable Mortgage vs Registered Mortgage Loan - Hindi - YouTube

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Namaskar, my name is Mukul, and welcome to asset Yogi.

Where we unlock finance knowledge.

Whenever you buy a property or take a loan against it

So from whichever financial institution or bank, you are taking a loan,

you have to mortgage your property.

Mortgage means the bank gets a charge on the property.

If a loan defaults.

So the bank can cover its dues by selling the property.

There are also two types of mortgages.

One is Equitable Mortgage and the other is Registered Mortgage.

Both types of mortgages are legal in India.

But the question that arises

why does the bank get the Equitable Mortgage accomplished

and in what cases?

In which cases registered mortgage should be accomplished

Both have their advantages and disadvantages in their places.

Some risks are also associated

So in this video, we will see what is the difference between them.

Under what conditions are the Equitable Mortgage right?

What are the advantages of a registered mortgage?

what are the disadvantages of both

Will shed light on everything in detail

So stay tuned till the end.

Let us go straight to the blackboard

Now let's see what are the differences between an equitable mortgage and a registered mortgage

First, let's talk about the agreement

We are talking about the loan agreement

So whenever you take a loan from any bank or financial institutions

So you have to sign a loan agreement

In Equitable Mortgage, a loan agreement is signed between the lender and borrower.

But in the case of a registered mortgage, along with signing the agreement,

registration is also done in the sub-registrar office

And you also have to pay stamp duty.

So as you register the sale deed in the sub registrar's office

In the same way, if you are registering the mortgage deed in the sub-register office,

So we call it a registered mortgage.

And this is the biggest difference

between Registered mortgages and equitable Mortgages.

Apart from this, another big difference is how title deeds

and property documents are handled.

In Equitable Mortgage, it is very important to submit all these documents to the lender.

Only then the mortgage is created.

And in the case of registered mortgage

It is not necessary to submit title documents or property documents in the banks

But most of the banks Insist to submit the property documents.

There are many old or agricultural properties whose title agreements are missing.

Or does not exist

So in such cases, you must register it if you have taken any loan from the bank.

In such cases, the bank always considers the registered mortgage

If for some reason the title documents of that property do not exist.

And what are the other differences?

The stamp duty on Equitable Mortgage is very less.

Because you don't have to register it.

So, in the case of Equitable Mortgage,

the stamp duty is very nominal.

Your loan agreement will be signed on the stamp paper.

And those charges are not very much

There are very nominal charges.

But the stamp duty is much higher in the case of a registered mortgage.

It varies from state to state.

Other than that, what are the differences?

When you will clear your principal, interest, and all dues.

So the lender will hand over all the property documents to you.

And will give you a no dues certificate.

But in the case of a registered mortgage, it is a bit complicated.

You have signed and registered a mortgage deed earlier with the bank.

Again you have to execute a document.

Bank will execute you a document which we call Memorandum of Release.

And you will also have to register that document in the sub-registrar office.

And you will have to pay stamp duty again.

Only after that information will be registered.

This leads to add another step.

In the case of a registered mortgage, two steps are extra.

First, you got the mortgage deed signed and registered in the sub-registrar office.

After that, you also registered the release of the mortgage deed.

So these are two extra steps.

Because you are registering it, it also has some advantages

When you see an Encumbrance certificate.

In the encumbrance certificate, if there is any kind of charge on the property,

So it is reflected in the certificate.

If you want to know about the Encumbrance Certificate in detail.

So I have made a detailed video on an encumbrance certificate.

You can watch it

I write video here

In the encumbrances certificate, you get to know all the charges of the third party

If there is any kind of tax dues if a mortgage is signed or a loan is taken.

or any kind of lease, you get all these encumbrances in the encumbrance certificate.

But you will not know the case of an equitable mortgage,

it will not reflect in the encumbrances certificate, because in the case of Equitable Mortgage

you are only signing an agreement between the lender and borrower.

And you are just giving the property documents to the lender.

Its information is not with the sub-registrar. But in the case of registered mortgage

Mortgage charges will be reflected in the encumbrances certificate.

So let's see what are its advantages and disadvantages.

Because the process is so simple, most banks prefer equitable mortgages.

Here you do not have to register the mortgage deed.

And don't have to pay stamp duty.

So these 2 steps are forgone.

The first step is to sign the mortgage deed.

And the second step is to release it.

But Registered Mortgage also has some advantages.

However, it requires more time and money.

But the advantage is that the risk is reduced.

The risk is slightly higher in the case of an equitable mortgage.

Suppose you have mortgaged or taken a loan.

Some people also take another loan.

They say that the documents of their property have been lost.

Again they take the loan with the duplicate document.

Although it is a criminal offence But some people may do this.

Second, if the seller has taken a loan against the property.

So many times, the sellers who have the criminal mindset

That seller won't tell the buyer that there is already a loan against the property.

And he may say that his property documents have been lost.

And he sells ​​the property on duplicate documents.

Sometimes builders also do this with

Fly by night type of operators

take a loan from the bank even after they sell the property.

And the buyers don't get to know

So in such a situation, you must go with a reputed builder.

And you should also complete the due diligence.

This is very important before buying a property.

This is especially important in the case of an Equitable Mortgage.

In the case of a registered mortgage, the risk is greatly reduced.

In the encumbrances certificate, you will know whether there is a loan or not.

These are all major differences between an equitable mortgage and a registered mortgage.

As I said, the advantage of Equitable Mortgage is it is a very simple process.

It doesn't have any hassles

On the other hand, the advantage of a registered mortgage is

The risk is reduced significantly when you buy a property.

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And be happy.