Different Types of Mortgages and Bank loans

What is meant by mortgage? 

Mortgage is specified in Section 58 of the Transfer of Property Act. Mortgage is defined as the transfer of an interest in specific immovable property for the purpose of securing
i) the payment of money advanced or to be advanced by way of loan;
ii) an existing or future debt; or
iii) the performance of an engagement which may give rise to a pecuniary liability.

Thus, mortgage is a method of creation of security interest. 

What constitutes a mortgage? 

The essential components of a mortgage are:
1) There is transfer of an interest with respect to an immovable property.
2) The interest transferred must be of some specific immovable property.
3) The purpose of transfer of interest must be
a) to secure – i) payment of money advanced or ii) to be advanced by way of loan,   
                       iii) an existing or future debt or,
b) the performance of an engagement which may give rise to a pecuniary liability.

What are the major terms associated with mortgage? 

Mortgagor:-The transferor of the interest in the specific immovable property
Mortgagee:- The transferee who receives the interest in the specific immovable property
Mortgage-money:- The principal and interest, payment of which is secured by the mortgage. 
Mortgage deed:- The instrument/document,  if any,  by which the interest is transferred. 

What are the different types of mortgages? 

Section 58 of the Transfer of property Act mentions six kinds of mortgages.

1) Simple mortgage / registered mortgage.
2) Mortgage by conditional sale.
3) Usufructuary mortgage.
4) English mortgage.
5) Mortgage by deposit of title-deeds (Equitable mortgage)
6) Anomalous mortgage.

Simple mortgage and Equitable mortgage are elaborated in the article "Simple Mortgage, Equitable Mortgage and Bank Loans" and other kinds of mortgages in the article "Different Types of Mortgages- A Comparison". 

Of the above six kinds of mortgages, banks prefer mortgage by deposit of title deeds (equitable mortgage)  and simple mortgage over other types of mortgages for securing a bank loan. Creation of charge by way of equitable mortgage is much easier compared to simple/registered mortgage. Hence simple mortgage is insisted only in exceptional cases. 

What is meant by right of redemption? 

The mortgagor has a right to require the mortgagee to deliver to the mortgagor the mortgage deed and/or title deeds and all other documents on payment of the mortgage money, at any time after the mortgage money has become due. This is known as right of redemption. The mortgagor is thus entitled to redeem the mortgage by paying the entire amount due at any time before the bank puts the mortgaged property to sale for realisation of the dues. When the mortgagor’s right to redeem accrues, the mortgagee has a right to enforce his security.    CERSAI and Equitable Mortgage Registration