The main mortgage is a contract where the creditor acquires a residential or commercial property dedicated to the fulfillment of his or her financial obligation in kind, where he or she might apply to ordinary creditors and the following lenders in order to get the right of the rate of that residential or commercial property in any hand.

The home loan is a contract concluded in between the mortgagor and the mortgagee financial institution which grants the mortgagee right in rapid eye movement in the residential or commercial property, with all benefits and real security over the home loan item. Additionally, the mortgagor can follow the mortgaged residential or commercial property if it is transferred to a 3rd party. The mortgagor retains ownership and belongings of the mortgaged residential or commercial property but is limited in their disposal rights to make sure the mortgagee's interests are secured.

The difference between the main home loan and the possessory home loan

The official home loan is developed through an official agreement, that must be notarized in a notary public workplace.

While the right of possessory home mortgage is produced through informal agreement. Whereas the ownership and possession of the mortgaged residential or commercial property in the official home mortgage right remains in the hand of the owner (debtor), and the possession in the possessory mortgage is transferred to the lender.

The main mortgage is restricted to property, while the possessory home loan can cover both properties and movable residential or commercial properties.

The commitments of the mortgagor and the mortgagee creditor in the main mortgage

The Egyptian Civil Law No. 131 of 1948 and its changes regulate the commitments of the mortgagor and mortgagee in Chapter Two as follows:

The Mortgager's commitments:

The mortgagor is bound to deliver the mortgaged residential or commercial property to the lender or to a designated representative picked by both Parties in the agreement.

The legal requirement for a seller to provide an offered product will be applied to the mortgagor's duty to deliver the mortgage product to the mortgagee. If the mortgaged residential or commercial property is returned to the mortgager's ownership, the home loan will be expired, unless the mortgagee shows that the residential or commercial property has been returned for a factor not intended to expire the mortgage.

The mortgagor guarantees the stability and enforceability of the home loan, and the mortgagor will not take any action that reduces the value of the mortgage or impedes the creditor's workout of his rights under the contract. In case of seriousness, the mortgagee lender may take all necessary measures at the mortgager's cost, to preserve the home mortgage product. The mortgagor shall be responsible for the loss or damage of the home loan product if such loss or damage is due to his fault or occurs from force majeure act.

The provisions of Articles No. 1048 and No. 1049 relating to the loss or damage of the mortgaged residential or commercial property under an official home loan, and the transfer of the lender's right from the mortgage product to any substituted rights will use to the possessory home loan.

The Mortgagee's commitment:

Upon receiving the mortgaged residential or commercial property, the mortgagee is obliged to work out the exact same level of care and upkeep in its preservation as would a sensible person. and he is accountable for the loss or damage of the mortgage item unless it is shown that such loss or damage was brought on by an external factor beyond his control.

The mortgagee is not permitted to derive any advantage from the home loan item without payment, he needs to invest it totally unless otherwise agreed Any net profits or advantage derived by the lender from the usage of the home loan item shall be subtracted from the amount protected by the home mortgage, even if the due date has not yet come, offered that the deduction shall be made from the cost of preserving and repairing the residential or commercial property and its repair work, then from expenditures and interest, and then from the principal of the financial obligation.

If the mortgage item produces earnings and the celebrations agree that all or part of the earnings will be utilized to offset the interest, in, this arrangement shall be valid within the maximum limits of lawfully permissible contractual interest.

The mortgagee shall presume the management of the mortgaged residential or commercial property, and he must exercise in that the care of a sensible person. The mortgagee can not modify the home loan product's use without the mortgager's approval. He must quickly inform the mortgagor of any matter requiring his intervention.

If the mortgagee abuses this right, mis-manages the residential or commercial property, or commits gross negligence, the mortgagor has the right to demand that the item be placed under custody or to recover it upon payment of the exceptional financial obligation. if the amount secured by the home mortgage does not bear interest and has not yet ended up being due, the mortgagee is entitled just to remaining quantity after deducting the worth of interest calculated at the legal rate for the duration between the day of payment and the due date of the financial obligation.

The mortgagee shall return the mortgaged item to the mortgagor after the mortgagor has actually fully discharged their responsibility consisting of all costs and settlement related to the right.

Effects of the official home mortgage in the Egyptian law

The impact of the home mortgage in between the contracting celebrations:

Firstly: The mortgager:

The mortgagor may dispose of the mortgaged residential or commercial property as long as such actions do not hinder the mortgagee's right.

The mortgagor keeps the right to manage the mortgaged residential or commercial property and to collect its returns and leases granted by the mortgagor are not enforceable versus the mortgagee unless it was notarized before the registration of the expropriation notice.

However, if the lease was not notarized in this method, or it was concluded after notarizing the notification and the lease was not paid in advance, so it will not work unless it can be thought about part of the excellent management work. If the lease term prior to notarizing the home loan notification surpasses 9 years, it will not work against the mortgagee financial institution except for a duration of 9 years just unless it was registered before the home mortgage was registered.

The mortgagor is accountable for guaranteeing the safety of the home mortgage residential or commercial property. The mortgagee financial institution can challenge any actions or carelessness by the mortgagor that could considerably lessen the worth or safety of the residential or commercial property, and in immediate cases the mortgagee may take essential protective measures and seek compensation from the mortgagor, from any costs sustained.

If the mortgagor negligently causes the damage or damage of the mortgaged residential or commercial property, the mortgagee lender has the option to require sufficient insurance coverage to cover the loss or to right away collect the full arrearage.
wikipedia.org
When the damage or damage to the mortgaged residential or commercial property is caused by an external aspect and the mortgagee declines to accept the financial obligation without insurance coverage, the mortgagor has the alternative to provide adequate insurance or settle the financial obligation instantly before the due date. If the debt has no interest, the mortgagee is just entitled to the principal amount without legal interest for the duration between the actual payment date and the original due date.

Secondly: The mortgagee creditor:

A third-party mortgagor's individual possessions are exempt from seizure for the debtor's debt. The mortgagor can not substitute payments for the debtor unless upon.

Upon alerting the debtor of the exceptional financial obligation, the mortgagee deserves to foreclose on the mortgaged residential or commercial property and requests its sale in accordance with the treatments and timelines stated in code of Civil Procedures. If the mortgagor is a 3rd party aside from the debtor, he can prevent any foreclosure procedures by willingly surrendering the mortgaged residential or commercial property according to the treatments and rules governing residential or commercial property surrender.
merriam-webster.com
Any arrangement that approves the mortgagee the right to take ownership of the mortgaged residential or commercial property at an established price upon financial obligation default or to sell it without following the lawfully mandated treatments is void, even if participated in after the home loan contract. However, after the financial obligation or a portion of it has actually matured, the debtor and mortgagee can concur that the debtor will transfer the mortgaged residential or commercial property to the mortgagee in fulfillment of his financial obligation.

The official mortgage and its result to the 3rd party:

A main home loan is only enforceable against 3rd parties if the home mortgage contract or judgment establishing the mortgage is signed up before the 3rd celebration obtains a right in rem in the residential or commercial property. This lacks prejudice to the provisions of personal bankruptcy laws.

Additionally, 3rd parties can not assert claims based on an unregistered safe right, the replacement of one creditor for another in this right, or the task of registration priority to another lender unless such actions are kept in mind in the margin of the initial registration.

The procedures for registration, renewal, cancellation, and cancellation an official home mortgage, along with the effects thereof, are governed by the arrangements of the Real Estate Registration Law. The costs of registration, renewal, and cancellation of a main home loan are borne by the mortgagor unless otherwise concurred upon.

The termination of the main home loan:

An official home mortgage ends upon the satisfaction of the protected financial obligation or the nullification of the underlying cause for the debt. However, any authentic rights obtained by 3rd parties throughout the duration between the home loan's expiration and its possible reinstatement remain unaffected.

If foreclosure proceedings are finished, the official home loan is definitively snuffed out, even if the residential or commercial property ownership changes hands. When the mortgaged residential or commercial property is offered through a forced auction, the mortgage rights end upon the deposit of the auction proceeds or their payment to eligible registered lenders.