What is Mortgage -
According to Section 58(a) of the Transfer of Property Act, 1882 A mortgage is the transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability.
Liabilities of the mortgagee -
According to Section 76 of the Transfer of Property Act, 1882, a mortgagee, in possession of the mortgaged property, is liable-
1. To maintain the mortgaged property as his own;
2. To make the best possible efforts to recover rents and profits from the mortgaged property;
3. In absence of a contract to the contrary, to pay the government taxes from the income of the mortgaged property;
4. In absence of a contract to the contrary, to maintain the mortgaged property from the balance amount of income after payment of government taxes;
5. Not to do any harm to the mortgaged property;
6. To maintain the record of income from mortgaged property and expenses incurred by him on the mortgaged property
According to Section 77 of the said Act, the abovementioned conditions 2, 3, 4 and 6 are not applicable in case of contract that the rents and benefits arising out of the mortgaged property will be adjusted against interest on principal money.
Furthermore, in the case of two or more mortgages of the same property, the mortgage
mortgages executed subsequently. It is worth mentioning that the priority is by the time of execution and not by the time of registration of documents.
According to Section 78 of the Transfer of Property Act 1882, priority will be forfeited on account of fraudulent misrepresentation or gross negligence of the prior mortgagee.