• Equitable Mortgage Deed against Property vs Deed of Mortgage

Have obtained a loan against property from a Nationalized bank. 
- We have deposited the original title deed of the property to BMC, Mumbai.
- BMC has issued a letter to the Bank stating followings :
  * BMC confirms position of the title original deed with them
  * BMC has marked a lien on the said property as requested by the Bank
  * BMC has also confirmed that they will not transfer / lease out this property to the third party.
In view of loan Bank and us have signed Equitable Mortgage and have paid required stamp duty,
Now the Question is Do we still require to create a Deed of Mortgage and register the same. This is being insisted by the Bank
Thanks in advance for your valuable opinion
Asked 1 year ago in Property Law from Greater Mumbai, Maharashtra
Religion: Hindu
1) equitable mortgage is created by deposit of title deeds 

2) however it has to be registered as rightly pointed out by bank 

3) With a view to curb malpractices in transactions relating to immovable property, Maharashtra Govt has made it mandatory to register the following documents & notices:
1) In case of creation of equitable mortgage by deposit of title deeds, the mortgagor is now required to send online notice of the mortgage to the registering officer within 30 days using e-filing module under Section 89B of Registration Act


4) in respect of Mortgage by deposit of title deeds created on or after 1 April 2013
a. If, an agreement is signed between the mortgagor (borrower) and mortgagee (lender), it must be  compulsorily registered within 4 months from the date of its signing.

b. If no agreement is signed, the mortgagor (borrower) has to file a notice of intimation detailing mortgaged property, details of borrower, lender, amount received under mortgage, rate of interest, list of documents deposited, to the registering officer (having jurisdiction over the immovable property) within 30 days from depositing the title deeds with the mortgagee (lender)and thereby mortgaging the property.

c. If the mortgagor (borrower) fails to file the notice within 30 days and subsequently enters into any transaction in relation to the mortgaged property, such transaction will be void and the third party will be entitled to refund of the amount paid, plus 12% (twelve percent) interest from thedate of payment as compensation. The amount recoverable by the lender will be a charge on themortgaged property
Ajay Sethi
Advocate, Mumbai
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Hi, under normal circumstances the Bank will be insist for  the Equitable Mortgage deed because they want some documents to show that they have mortgage the property.

2. Some time it is depending upon the policy of the bank also.
Pradeep Bharathipura
Advocate, Bangalore
4105 Answers
133 Consultations
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1. An equitable mortgage has already been created between you and the bank which has been stamped according to the law in existence.

2. A separate deed of mortgage is not required. The empanelled lawyers of the bank are expected to be aware of this. Be that as it may, there is no harm in executing a mortgage deed if the bank does not relent. 
Ashish Davessar
Advocate, Jaipur
18275 Answers
451 Consultations
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In the normal circumstances, the EM will be sufficient for Bankers to secure the property on loan.  However it depends on the bank who may insist on regular mortgage too.  This cannot be objected to.  There is no legal infirmity in it.  The bank has rights to enforce deed of mortgage despite complying with the said formalities properly. 
T Kalaiselvan
Advocate, Vellore
14177 Answers
128 Consultations
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