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The starts of a mortgage system have been discovered, and are stated to go back as far as 1190. English common law contained a law that will shield a lender by giving him an interest in his debtor’s property. The debtor could, in case the debt was not paid, sell the property to regain his cash, even though the lender held title to the property.
The history of the real word “mortgage” is quite intriguing. Mortgage is a dead pledge. The latin word “mort” is death and the latin for “gage” is a pledge.
This old English version from the 16th century hasn’t lost much meaning and defines our understanding of real estate mortgages today:
The great jurist Sir Edward Coke (1552-1634) says of the word “mortgage”: It seemeth that the cause why it is called mortgage is, for that it is doubtful whether the Fee-offor will pay at the day limited such sum or not, & if he doth not pay, then the Land which is put in pledge upon condition for the payment of the money, is taken from him forever, and so dead to him upon condition, And if he doth pay the money, then the pledge is dead as to the Tenant…
Here’s another fascinating piece of trivia: initially, possession rights went to the sky from the middle of the planet. Naturally, now they are usually restricted to surface rights only. Look for later article on the type of transference’s that have evolved over the centuries and the impact that discoveries of new uses for natural resources have had on titles to property and property rights.
Mortgage history has its origins in early culture. Many scholars hypothesize that an assurance to acquire property before the arrival of the mortgage was sworn by debtors. During these times, the “mortgagor” would make an arrangement with a “mortgagee” to trade property for repayment as time passes. Among the first reports of mortgage law stalks from early India in the shape of the Code of Manu, an early Hindu script that rejects deceitful and deceptive mortgage practices. Usurers had a unique spot in the seventh circle of hell, based on Dante’s Inferno.