Distinction between “pledge‟ from “mortgage”.

Pledge

  • This is a pawn
  • It is the delivery of goods by a debtor to a creditor as a security for the amount borrowed or advanced to the debtor.
  • Its salient feature is delivery of possession.
  • The creditor acquires possession while the debtor retains ownership

 

Mortgage

  • Mortgage is the conveyance of land or assignment of a chattel as security for the payment of debt or the discharge of some other obligation for which it is given.
  • Mortgage involves the use of land as security for a loan.
  • There is conveyance of the land to the mortgagee.
  • The mortgagor’s right of redemption is a critical component of a mortgage.

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