What does mortgage guarantee mean? Mortgage guarantee means that the debtor or the third party takes the property as the guarantee of the creditor's rights without transferring the possession of a specific item. When the debtor fails to perform the debt, the creditor has the right to be paid in priority with the discount of the property or the price of auction or sale of the property in accordance with the provisions of the guarantee law. The scope of mortgage guarantee includes the principal creditor's right and its interest, liquidated damages, damages and expenses for realizing the mortgage right. Unless otherwise agreed by the parties, such agreement shall prevail.

Characteristics of loan mortgage guarantee

First, the mortgagor can be a third person or the debtor himself. This is different from a guarantee, in which the debtor is no longer a guarantor.

Second, collateral can be movable property or immovable property. Unlike pawn shops, pledge can only be movable property.

Third, the mortgagor does not transfer the possession of the collateral, but can continue to possess and use the collateral. This is also different from pawn shops, where high-quality goods must be transferred to the owner of the pawn shop.

Fourth, the mortgage guarantee is realized by the mortgagee (creditor) exercising the priority of compensation, which is the core content of mortgage.

Fifth, the exercise of mortgage must be based on the debtor's non-performance.