A mortgage may be defined as an estate created by a conveyance, absolute in form, but intended to secure the performance of some act, such as the payment of money or the like, by the grantor or some other person, and to become void if the act is performed agreeably to the terms prescribed at the time of making such conveyance. Thus, A borrows $5,000 from B, giving B his promissory note. For B's security he also gives B a mortgage on a piece of property he (A) owns.. This mortgage states that if A does not pay the promissory note, then, after fulfilling certain formalities, B can possess himself of the property which is described in the mortgage. Certain property is secured to the lender in case the borrower fails to pay. The mortgage must be signed, sealed, witnessed, acknowledged (statement by the proper officer, such as a justice of the peace, notary public, or other officer empowered to take acknowledgments that the maker has appeared before him and acknowledged the instrument to be his wilful and intended act, or words to that effect, the exact language used differing in the various States), delivered by the borrower (the "mortgagor") to the lender (the "mortgagee"), and accepted by the lender. It should also be recorded (that is, placed on record in what is called the Registry of Deeds Office at the county seat) in order to prevent a dishonest borrower from giving another mortgage on the same property, which might be recorded prior to the first one given and thus have superior rights. No particular form is required for the defeasance (a condition relating to a deed or other instrument on the performance of which the instrument is to be defeated or rendered void) clause. Any deed which shows by its form that it was issued to secure the payment of a debt will be held to be a mortgage, and, in some jurisdictions, oral testimony will be admitted to show that deeds are not absolute conveyances but merely intended to secure the payment of money. Thus, in some States, the defeasance clause could be proved to exist by oral evidence, even though the rest of the deed is in writing. In some States the lender's interest can be transferred by assignment; in other States his interest can be transferred only by deed. Second and other subsequent mortgages may be placed on the same piece of property. Suppose A issues a mortgage to B and then another to C on the same piece of land. He fails to pay C, who may foreclose (take steps to have the property sold to pay the debt due him). But B's claim would have to be satisfied first. If a borrower is married both he and his wife must sign the mortgage. Mortgages are often given to banks to secure loans made. There is a clause inserted in some mortgages which gives the lender the right to sell the property securing the debt, if the debt is not paid when due. This saves the lender the trouble of court proceedings to prove his right to sell. Deeds. - A deed is a document used to transfer the title of real estate from one person (the "grantor") to another (the "grantee"). The essentials of a deed have already been mentioned. They are the signature and seal of the person giving the deed; its delivery to the grantee (the person to whom the deed is given); its acceptance by the grantee. The deed does not have to be dated, and unless required by statute it does not have to be witnessed (signed by a disinterested person who saw it executed). However, since many States require by statute that a deed be witnessed, it is a safe procedure to have it done. As between the parties themselves acknowledgment is not necessary; but it is usually required by statute before the deed may be recorded. The wife of a married man must sign the deed. In a "quit-claim" deed the person giving it does not hold himself responsible for any defects in the title of the property; that is, he only transfers the rights he has in it himself. In a "warranty" deed the person giving the deed guarantees that there are no defects in the title to the property, and should any defect later be discovered the acceptor of the deed can recover from the grantor. If there is a mortgage on the land when the deed is made the purchaser is bound to recognize the mortgage as a valid charge against the land. That is, A gives a mortgage on a piece of land worth $5,000 to B, to secure a $2,000 debt. A then sells the land to C. A fails to pay his debt to B, who forecloses. The property is sold for $5,000, and C would be entitled to the $3,000 remaining after B's claim is satisfied. If C sold the property to D, D would then occupy the position of C.