Difference between Mortgage and Pledge Definition, Benefits

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Difference between Mortgage and Pledge Definition, Benefits

A mortgage is a debt instrument in which the borrower guarantees property as collateral for his debt, which must be repaid by the borrower with predetermined payment terms. Quoted from KBBI, mortgage has two meanings, namely credit given on the basis of collateral in the form of immovable objects (assets) and long-term debt statements containing provisions that the creditor can transfer part or all of the claim rights to third parties.Collateral in the form of immovable assets or objects, for example, is land and buildings, such as houses and buildings apartment.

Souce:Investopedia | Mortgage Illustration

In English, a mortgage is known as the word "mortgage". The word mortgage is an absorption word that comes from the word "hypotheca" (Latin) and "hypotheek" (Dutch) which means imposition

“debt instruments by granting mortgage rights over property and borrowers to lenders as collateral for their obligations; in this case the borrower can still use or utilize the property; Mortgage rights over the property fall after the obligations are paid off (mortgage).

In general, a mortgage is a long-term loan or credit scheme. Loans are used to finance property (immovable assets) which generally have high costs and cannot be done in cash. Over a certain period or years, the borrower can repay the loan in installments along with interest, until it is paid off until finally the borrower can fully own the property.

From the two definitions above, we can understand several things, namely:
  • A mortgage is a long-term debt instrument in the form of a loan to buy property or land, with collateral in the form of the land or property itself.
  • The house or land is borne by the borrower (debtor) from the lender (creditor) with a loan object that the debtor can still use.
  • Borrowers can own a house by paying off the mortgage debt, namely the value of the house and the interest.
  • If the borrower fails to pay off his mortgage debt, then the collateral object becomes the property of the lender (creditor).

Object of Mortgage

The object of the mortgage is as follows:

  • Immovable objects and their accessories that can be transferred
  • The right to use an object and all its accessories
  • The right to hitch a rock and the business right
  • Land interest paid in money or with land proceeds
  • Flowers as before
  • The market which is recognized by the government and the original rights attached to it

Nature and Characteristics of Mortgage

Procurement of mortgages is regulated in the Civil Code, which also mentions some of the characteristics and characteristics of mortgages. The nature of the mortgage is:

  • Absolute, meaning that rights can be defended against any demands.
  • Droit de suiteor zaaksgevolg, meaning that this right always follows the object in the hands of whoever the object is. (Article 1136 paragraph 2, Article 1198 of the Civil Code)
  • Droit de preference, meaning that a party has the right to fulfill its receivables first among other creditors. (Article 1133, 1134 paragraph 2 of the Civil Code)
Source: Market Bussines News | Mortgage Flow Illustration

While the characteristics of a mortgage are as follows:
  • accecoir, meaning that the mortgage is an additional agreement that depends on the main agreement regarding accounts payable
  • Ondeelbaar, meaning that the mortgage cannot be divided because the mortgage is attached to all the objects that are the object, so that the mortgage right will not be partially removed even though some of the debt has been paid.
  • verhaalsrecht,meaning that the mortgage only contains the right of debt repayment, not the right of ownership of objects. Unless previously agreed, the creditor may sell the collateral in question.
  • Pawnis a right that is obtained by someone who has receivables on a movable or immovable object (motorcycle, car, paddy field, house) which is handed over to him by a debtor or by another person on his behalf, and gives authority to the person who owes it to take payment of said item in priority over other people other creditors; with the exception of the cost of auctioning the item. Where a person has to pawn his goods to get money.
  • In general, the definition of a pawn business is an activity of guaranteeing valuables to certain parties, in order to obtain a certain amount of money and goods that are guaranteed to be redeemed in accordance with the agreement between the customer and the pawnshop.
  • The definition of pawning in Islam is called Rahn, which is an agreement to hold an item that is used as collateral or a debt guarantee. Rahn is also a debt contract by making goods that have economic value in the view of syara' as collateral, so that the holding party obtains collateral to be able to take back all or part of the receivables.

Examples of objects that are movable and can be mortgaged are:

  1. Vehicle
    The first example of pawning goods is a personal vehicle in the form of a motorbike or car, the debtor can pawn it by submitting related documents, such as the BPKB (Motorized Vehicle Ownership Book), STNK (Vehicle Registration Certificate), and purchase invoices.
  2. Precious metal
    Second, there are precious metals as examples of movable items that can be pawned, such as gold, diamonds, jewelry, gems, and diamonds.
  3. Certificate
    Another example of a pawn item is a certificate, such as a land or house certificate. Later, the value will be determined based on the value of PBB (Earth and Building Tax) as well as the position of the building or land, whether it is strategic or not.

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