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What is equitable mortgage?

What is equitable mortgage?

Equitable Mortgage Meaning: Equitable mortgage is a type of mortgage where the terms of the agreement are made solely between the mortgagor and the mortgagee. There is no third party or government agency involved.

What is a pledge in banking?

A pledged asset is collateral held by a lender in return for lending funds. Pledged assets can reduce the down payment that is typically required for a loan as well as reduces the interest rate charged. Pledged assets can include cash, stocks, bonds, and other equity or securities.

What is a lap loan?

A loan against property(LAP) is a secured loan that is sanctioned against the asset pledged as collateral. This asset can either be an owned land, a house, or any other commercial premises. The asset remains as collateral with the lender until the entire loan against property amount is repaid.

Do underwriters want to approve loans?

An underwriter will approve or reject your mortgage loan application based on your credit history, employment history, assets, debts and other factors. It’s all about whether that underwriter feels you can repay the loan that you want. But a seasoned loan originator is the integral part of the whole process, he says.

Can a loan be denied in underwriting?

Even if you are pre-approved, your underwriting can still be denied. Your loan is never fully approved until the underwriter confirms that you are able to pay back the loan. Underwriters can deny your loan application for several reasons, from minor to major.

Is equitable mortgage legal?

No legal procedure is involved in an equitable mortgage, but it is considered mortgage in the interest of justice (under equity). The borrower obtains money from the bank/lender with an agreement that his property, on which the equitable mortgage is created, will act as security for the loan.

Is equitable mortgage a charge?

As the name suggest, equitable mortgage is created by the borrower in favour of the lender by deposit of title deed of immovable property as security to a lender until the loan is fully repaid. This creates a charge on the property, though no legal procedure is involved.

What is pledge and mortgage?

Pledge is used to create a charge over movable properties whereas Mortgage is used in case of immovable properties. In case of pledge, the goods are kept with the lender, whereas mortgaged properties are retained with the borrower.

What is difference between pledge and mortgage?

So, in short, mortgage is a term that is used for fixed assets like land, buildings, apartments etc. When you pledge your shares, they would still remain with you and you would be entitled to dividends etc. However, when you mortgage your apartment, the documents would remain with the lender.

What is the process of lap?

Loan against property is nothing but a loan which you avail by keeping your commercial/residential property as a collateral. Another name for Loan against property is a secured loan. The security in this kind of loan is the property owned by the person applying for the loan.

What can be the end use of funds for lap?

The funds come with no end-use restriction and can be used to fulfil multiple financial objectives requiring lump sum expenditure. LAP full form is loan against property. The advance is available for an extended tenor, which makes it affordable to repay.