What is a mortgage?
		A mortgage is basically a loan which is secured on a property. The Mortgages Act defines a mortgage as a direct and immediate pledge of the property affected thereby, irrespective of who the possessor of such property may be, to secure compliance with the obligation for which they are constituted. Mortgages may be constituted to secure all kinds of obligations and shall not alter the debtor's unlimited personal liability as established in article 1,911 of the Civil Code.
		For a mortgage to have full legal effect, it has to be given on a public deed of mortgage before a Notary Public and thereafter registered. A non-registered mortgage is in legal terms no more than an ordinary loan, and therefore does not constitute a preferential charge on the property. If a mortgage is not registered, it is not a mortgage, leaving the bank with a personal action against the borrower in case of default, as opposed to a real action if it were registered. This preference is achieved by banks by registering the mortgage in the Land Registry. Prior searches ensure there are no adverse antecedent entries in the Land Registry which would reduce the value of the property. After the mortgage deed has been signed, the lender´s legal team ensures registration is verified within the time limits given by the law. The lender also avails himself of the mandatory coordination between the Notary Public and the Land Registry to ensure no entries are accepted in the Land Registry between the moment of the signing of the mortgage deed and proper registration. This system applies equally to a property purchase without a loan. Lending institutions loan money on the strength of two variables: a) the repayment ability of the borrower. b) the value of the property which is used as security for the loan repayment. Once the lending institution is satisfied with the borrower´s profile and the property object of the purchase, the funds are released.