mortgage

In equity, the debt or bond is treated as the principal, and the mortgage as the incident. It passes by the assignment or transfer of the bond, and is discharged by its payment. It is, in fact, but a special security, or lien on the property mortgaged. The remedy obtained on it in a court of equity is not the recovery of land, but the satisfaction of the debt. It is the pursuit by action of one debt on two instruments or securities, the one general, the other special.

+ 11 more definitions — see all 19 over time

The conveyance of an estate or property by way of pledge for the security of debt, and to become void on payment of it. 4 Kent, Comm. 136. An estate created by a conveyance absolute in its form, but intended to secure the performance of some act, such as the payment of money, and the like, by the grantor or some other person, and to become void if the act is performed agreeably to the terms prescribed at the time of making such conveyance. 1 Washb. Real Prop. 475. By the law of several states, a mortgage is no longer a conveyance by which an estate passes, but a mere pledge creating only a lien. Holmes, Mortg. § 1. Two general theories prevail as to the nature of the estate created by mortgage. The common-law theory that a mortgage passes title to the mortgagee subject to defeat by the performance of the condition subsequent has been adopted in Alabama (69 Ala. 442), Arkansas (65 Ark. 174), Connecticut (19 Conn. 218), Illinois (1 Scam. 140), Maine (2 Me. 132), Maryland (6 Gill & J. 72), Massachusetts (5 Mass. 120), New Hampshire (5 N. H.) 420), North Carolina (66 N. C. 477), Ohio (10 Ohio, 71), Pennsylvania (77 Pa. St. 250), Rhode Island (6 R. I. 542), Tennessee (10 Humph. 214), and Virginia (4 Rand. 245). The common-law theory, in a somewhat modified form, prevails in Delaware (1 Houst. 320), Mississippi (24 Miss. 368), Missouri (10 Mo. 229), New Jersey (40 N. J. Law, 417), and Vermont (44 Vt. 294). The equitable doctrine that a mortgage conveys only a lien is adopted in California (2 Cal. 491; 64 CaL 514), Colorado (Laws 1887, § 263, p. 174), Florida (17 Fla. 698), Georgia (76 Ga. 384), Idaho (Rev. St. 1887, § 3350), Indiana (27 Ind. 472), Iowa (30 Iowa, 268), Kansas (35 Kan. 120), Kentucky (14 Bush, 788), Michigan (65 Mich. 598), Minnesota (12 Minn. 330), Montana (6 Mont. 596), Nebraska (14 Neb. 246), Nevada (1 Nev. 179), New York (54 N. Y. 599), North Dakota (Rev. Code, § 1733), Oregon (11 Or. 534), South Carolina (27 S. C. 309), South Dakota (Rev. Code 1877, § 1733), Utah (Comp. Laws 1876, p. 478), Washington (3 Wash. T. 318), Wisconsin (7 Wis. 566), 1 Pingrey, Mortg. 16. Both real and personal property may be mortgaged, and in substantially the same manner, except that, a mortgage being in its nature a transfer of title, the laws respecting the necessity of possession of personal property and the nature of instruments of transfer, being different, require the transfer to be made differently in the two cases. See "Chattel Mortgage." A mortgage may in form be either a conveyance with provision for a defeasance, or a conveyance absolute in form, with a collateral agreement for a defeasance. 15 Johns. (N. Y.) 555; 2 Me. 152; 12 Mass. 456. the property, but does some act by which he manifests his determination to bind the same as a security. See "Equitable Mortgage." A legal mortgage is a conveyance of property intended by the parties at the time of making it to be a security for the performance of some prescribed act. 1 Washb. Real Prop. 479.

A conveyance of real estate or assignment of personal property, without performance of some act, usually the payment of money, and treated at law as a conveyance or assignment, but in equity as a lien. The conveyance of an estate by way of pledge for the security of debt, and to become void on payment of it 4 Kent 136. An estate created by a conveyance absolute in its form, but intended to secure the performance of some act, such as the payment of money, and the like, by the grantor or some other person, and to become void If the act is performed agreeably to the terms presciibed at the time of making such conveyance. 2 Washb. R. P., 5th ed. *475. A conditional conveyance of land designed as a security for the payment of money, the fulfilment of some contract, or the performance of some act, and to be void upon such payment, fulfilment or performance. Mitchell V. Burnham, 44 Me. 299. A contract by which specific property is hypothecated for the performance of an act without the necessity of a change of possession. Sandmeyer v. Ins. Co., 2 S. Dak. 346, 50 N. W. 353. It is a mere security for a debt or obligation; Cook v. Bartholomew, 60 Conn. 24, 22 Atl. 444, 13 L. R. A. 452; Cleveland, P. & A. R. Co. v. Pennsylvania, 15 Wall. (U. S.) 322, 21 L. Ed. 179. “A concise definition of mortgage which should embrace both its equitable and its legal character is virtually impossible.... These attempted definitions are all erroneous upon any theory of the instalment; they do not go beyond the literal import of the language in which a mortgage is usually expressed, and they utterly ignore all the equitable elements which are as much and as truly constituent parts of the mortgage as the legal elements. Any true definition based upon the original common law and equitable system must embody and express all the double features of the mortgage — that it is both a lien in equity and a conveyance at law.'' Pomeroy, Eq. Jur. § 1191. The first definition, supra, is an attempt to do what Pomeroy here says is “virtually Impossible." It is, however, to be noted that advantage has been taken of his criticism of the definitions generally, and an effort made to supply what he pointed out as their deficiencies. Scientific legil writers reckon among proprietary rights ‘*jura in re aliena/^ i, e. rights of dominion over tangible things of which the fundamental property right is in another. Of such rights the most important is Pledge, which, in this sense, covers those legal relations in which a right in rem is conferred by a debtor upon a creditor as security for a right in personam, i. e. for the debt or other personal obligation of the debtor; Holland, Jurispr. ch. xi. Practically we distinguish these securities as Mortgage, when the debtor transfers the title to the rea to his creditor, retaining the possession of it, and Pledge, when he retains the title but transfers the possession. See Pledob. who received,the profits or revenues of it without applying them in satisfaction of his debt, and the land thus became dead to the mortgagor or borrowv er who derived no benefit from it. This was regarded as in the nature of usury on the part of the lender and was looked upon with disfavor, in modern pharse as cbntrary to public policy. In contrast to this was vadium vivum, or live pledge, under which the borrower continued in possession of his property, receiving the profits or revenues of it. Another explanation of the words is that in the vadium mortuum the pledge was dead to the borrower if he failed to redeem, but in the other was alive to him until the lender secured possession of it on default; 1 Coote, Mortg., 4th ed. 6; Co. Litt. 205. (In the case of Welsh mortgages, now disused, the mortgagee entered into possession, taking the rents and profits, but applying them on account of the debt.) In attempting to avoid the difficulty lenders devised the plan of taking from the borrower a conveyance of the property to become absolute upon the failure of the borrower to redeem. Later, the plan was adopted of taking an absolute conveyance, with an agreement on the part of the lender to re-convey on payment of the debt, the transaction being in form an absolute sale of land with an option to buy it back by payment of the loan at a fixed time. Another form was to convey the land to a trustee who was to hold to the creditor’s use, and on default was to sell it for the payment of the debt. All these devices were intended to protect the lender by enabling him to secure the land on his debtor’s default. All of them were modified or softened by the courts refusing to allow the forfeiture or to treat the transaction as other than a method of pledging the land as security for the debt, the debtor retaining what came to be known as the equity of redemption, and being protected agalnk the strict enforcement of his contract; H. W. Chaplin, in 4 Harv. L. Rev. 1. See Equity of Rbdbmption. In modern times although the old forms are still followed, it is everywhere recognized that the real owner of the land is the mortgagor, and the mortgage is a mere security for the debt or obligation, giving the mortgagee a chattel interest which passes to his personal representatives and not to his heirs. Some of the states have abrogated the old rule and declared by statute that the effect of a mortgage shall be merely to give a lien and not to pass an estate to the mortgagee. But in England and in most of the states the old rule remains nominally in force, and in courts of law the mortgage is recognized as conveying an estate, while equity treats it as merely conferring, a lien. Originally this was burdensome, since there was an actual distinction between the rules applied in the different jurisdictions, and redress had to be sought in equity against the severities of the law, but the principle adopted in Pennsylvania in the eighteenth century, of administering equity through.common law forms has been gradually making its way until it reached its most signal triumph in the adoption of the Judicature Act of 1873 in England providing that where * ‘there is any conflict between the rules of equity and the rules of common law, the rules of equity shall prevail.” To-day it may be safely said that the equitable doctrine has completely supplanted the legal, but as the form of the transaction is still the same, some confusion exista, and doubtless always will exist, in the definitions given of mortgage. Some of these have been quoted supra. See a discussion’ of the relations of mortgagor and mortgagee by Lord Selborne, in 6

An estate created by a conveyance absolute in its form, but intended to secure the performance of some act, such as the payment of money, and the like, by the grantor or some other person, and to become void if the act is performed agreeably to the terms prescribed at the time of making such conveyance. 1 Washb. Real Prop. 475. A conditional conveyance of land, designed as a security for the payment of money, the fulfiliment of some contract, or the performance of some act, and to be void upon such payment, fulfillment, or performanco. Mitchell v. Burnham, 44 Me. 299. A debt by specialty, secured by a pledge of lands, of which the legal ownership is vested in the creditor, but of which, in equity, the debtor and those claiming under him remain the actual owners, until debarred by judicial sentence or their own laches. Coote, Mortg. 1. The foregoing definitions are applicable to the common-law conception of a mortgage. But in many states in modern times, it is regarded as a mere lien, and not as creating a title or estate. It is a pledge or security of particniar property for the payment of a debt or the performance of seme other obllgation, whatever form the transaction may take, but is not now regarded as a conveyance in effect, though it may be cast in the form of a conveyance. See Until v. Goddard, 28 Mont 237, 72 Pac. 621, 98 Am. St Rep. 553; Johnson v. Robinson, 68 Tex. 399, 4 S. W. 62o ; In re McConnell's Estate, 74 Cal. 217, 15 Pac. 746; Killebrew v. Hines, 104 N. C. 182, 10 S. E. 159, 17 Am. St. Ren. 672. To the same purport are also the following statutory definitions: Mortgage is a right granted to the creditor over the property of the debtor for the security of his debt, and gives him the power of having the property seized and sold in default of payment. Civ. Code La. art. 3278. Mortgage is a centract by which specific property is hypothecated for the performance .of an act, without the necessity of a change of possession. Civ. Code Cal. § 2920.

— Chattel mortgage. A mortgage of goods, chattels, or personal property. See Chattel Mortgage.

— Conventional mortgage. The conventional mortgage is a contract by which a person binds the whole of his property, or a portion of it only, in favor of another, to secure the execution of some engagement, but without divesting himself of possession. Civ. Code La. art. 3290; Succession of Benjamin, 39 La. Ann. 612, 2 South. 187. It is distinguished from the "legal" mortgage, which is a privilege which the law alone in certain cases gives to a creditor over the property of his debtor, without stipulation of the parties. This last is very much like a general lien at common law, created by the law rather than by the act of the parties, such as a judgment lien.

— Equitable mortgage. A specific lien upon real property to secure the payment of money or the performance of some other obligation, which a court of equity will recognize and enforce, in accordance with the clearly ascertained intent of the parties to that effect, but which lacks the essential features of a legal mortgage, either because it grows out of the transactions of the parties without any deed or express contract to give a lien, or because the instrument used for that purpose is wanting in some of the characteristics of a common-law mortgage, or, being absolute in form, is accompanied by a collateral reservation of a right to redeem, or because an explicit agreement to give a mortgage has not been carried into effect. See 4 Kent, Comm. 150; 2 Story, Eq. Jur. § 1018; Ketehum v. St. Louis, 101 U. S. 306, 25 L Ed. 999 ; Payne v. Wilson, 74 N. Y. 348; Gessner v. Palmateer, 89 Cal. 89, 26 Pac. 789, 13 In R. A. 187; Cummings v. Jackson, 55 N. J. Eq. 805, 38 Atl. 763; Hall v. Railroad Co., 58 Ala. 23; Bradley v. Merrill, 88 Me. 319, 34 Atl. 160; Carter v. Holman, 60 Mo. 504. In English law, the following mortgages are equitable:
(1) Where the subject of a mortgage is trust property, which security is effected either by a formal deed or a written memorandum, notice being given to the trustees in order to preserve the priority.
(2) Where it is an equity of redemption, which is merely a right to bring an action in the chancery division to redeem the estate.
(3) Where there is a written agreement only to make a mortgage, which creates an equitable lien on the land.
(4) Where a debtor deposits the title-deeds of his estate with his creditor or some person on hls behalf, without even a verbal communication. The deposit itself is deemed evidence of an executed agreement or contract for a mortgage for such estate. Wharton.

— First mortgage. The first (in time or right) of a series of two or more mortgages covering the same property and successively attaching as liens upon it; also, in a more particular sense. a mortgage which is a first lien on the property, not only as against other mortgages, but as against any other charges or incumbrances. Green's Appeal, 07 Pa. 347.

— First mortgage bonds. Bonds the payment of which is secured by a first mortgage on property. Bank of Atchison County v. Byers, 139 Mo. 627, 41 S. W. 325; Minnesota & P. R. Co. v. Sibley, 2 Minn, l8 (Gil. 1) ; Com. v. Wiliiamstown, 156 Mass. 70, 30 N. E. 472,

— Second mortgage. One which takes rank immediately after & first mortgage on the same property, without any intervening liens, and is next entitled to satisfaction out of the proceeds of the property. Green's Appeal, 97 Pa. 347. Properly speaking, however, the term designates the second of a series of mortgages, not necessarily the second lien. For instance, the lien of a judgment might intervene between the first and second mortgages; in which case, the second mortgage would be the third lien.

— General mortgage. Mortgages are sometimes classified as general and special, a mortgage of the former class being one which binds all property, present and future, of the debtor (sometimes calied a "blanket" mortgage); while a special mortgage is limited to certain particular and specified property. Barnard v. Erwin, 2 Rob. (Lat) 415.

— Judicial mortgage. In the law of Louisiana. The lien resulting from judgments, whether rendered on contested cases or by default, whether final or provisional, in favor of the person obtaining them. Civ. Code La. art. 3321.

— Legal mortgage. A term used in Louisiana. The law alone in certain cases gives to the creditor a mortgage on the property of his debtor, without it being requisite that the parties should stipulate it. This is called "legal mortgage." Civ. Code La. art. 3311.

— Mortgage of goods. A conveyance of goods in gage or mortgage by which the whole legal title passes conditionally to the mortgagee; and, if the goods are not redeemed at the time stipulated, the title becomes absolute in law, although equity will interfere to compel a redemption. It is distinguished from a "pledge" by the circumstance that possession by the mortgagee is not or may not be essential to create or to support the title. Story, Bailm. § 287. See Chattel Mortgage.

— Purchase-money mortgage. A mortgage given, concurrently with a conveyance of land, by the vendee to the vendor, on the same land, to secure the unpaid balance of the purchase price. See Baker v. Clepper, 26 Tex. 629, 84 Am. Dec. 591.

— Tacit mortgage. In Louisiana. The same as a "legal" mortgage. See supra.

— Welsh mortgage. In English law. A species of security which partakes of the nature of a mortgage, as there is a debt due, and an estate is given as security for the repayment, but differs from it in the circumstances that the rents and profits are to be received without account till the principal money is paid off, and there is no remedy to enforce payment, while the mortgagor has a perpetual power of redemption. It is now rarely used. 1 Pow. Mortg. 373a. See O'Neill v. Gray, 39 Hun (N. Y.) 566; Bentley v. Phelps, 3 Fed. Cas. 250.

Mortntim vadium, I. A dead or unproductive pledge; a conveyance of lands, chattels or other subjects of property as a security for a debt, upon a condition that if the sum due be paid at a certain ' time the conveyance shall be void, otherwise become absolute,— the alternative, however, taking effect subject to the right or equity of redemption, v. Equitable mortgage.

In old English law. A pledge of movables or immovables as security for a debt, — called dead, because the contract was that the fruits or rents arising from the thing pledged should not go, as in case of what was called a live pledge, towards paying off the demand for which it was pledged.

An estate created by a conveyance absolute in its form, butintended to secure the performance of some act, such as the payment of money, and the like, by the terms prescribed at the time of making such conveyance. 1 Washb. Real Prop. *475. A conditional conveyance of land, designed as a security for the payment of money, the fulfillment of some contract, or the performance of some act, and to be void upon such payment, fulfillment, or performance. 44 Me. 299, A debt by specialty, secured by a pledge of lands, of which the legal ownership is vested in the creditor, but of which, in equity, the debtor and those claiming under him remain the actual owners, until debarred by judicial sentence or theirown laches. Coole, Mortg. 1. Mortgage is a right granted to the creditor over the property of the debtor for the security of his debt, and gives him the power of having the property seized and sold in de fault of payment. Civil Code La. art. 3278. Mortgage is a contract by which specific property is hypothecated for the performance of an act, without the necessity of a ehange of possession. Civil Code Cal. § 2920. In the law of Louisiana. The conventionul mortgage is a contract by which a person binds the whole of his property, or a portion of it only, in favor of another, to secure the execution of some engagement, but without divesting himself of the possession. Civil Code La. art. 3290. The judicial mortgage is that resulting from judgments (whether these be rendered on contested cases or by default, or whether they be final or provisional) in favor of the person obtaining them. Civil Code La, art. 3321, The law alone in certain cases gives to the ereditor a mortgage on the property of his debtor, without it being requisite that the parties should stipulate it. This is called “legal mortgage.” It is called also “tacit mortgage,” because it is established by the law without the aid of any agreement. Civil Code La. art. 3311.

Mortuum vadium, /. A dead pledge; one where the rents and profits did not go to the discharge of the debt. A conveyance of land defeasible on the performance of a certain condition; usually the payment of money.