Banking & Finance

What Is a Deed of Mortgage, and Do You Need One in Nigeria?

A. A Ombugadu & Co. · Banking & Finance

Anyone borrowing against property, or lending money secured by it, will eventually run into the term "deed of mortgage." It sounds technical, but the idea behind it is straightforward — it's the document that turns property into security for a loan.

What a deed of mortgage does

A deed of mortgage is a legal agreement in which a borrower (the mortgagor) offers property as security for a loan from a lender (the mortgagee). If the loan isn't repaid according to the agreed terms, the lender has a legal right to recover the debt from the value of the property, which can include selling it.

Why registration matters

A mortgage that isn't properly registered with the relevant Lands Registry may not be enforceable against third parties. This matters most when a property already has other claims or is later sold to someone unaware of the mortgage. Registration protects the lender's interest and gives it legal priority.

What to check before signing

An unregistered mortgage can leave a lender without a strong claim if the property changes hands.

For both borrowers and lenders

Whether you're borrowing against a property or lending with it as security, having the deed of mortgage properly drafted and registered protects both sides — it's worth getting this right at the outset rather than after a dispute over repayment arises.

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