**Difference between Mortgage & Charge is follows :-**
- There are two types of charges; fixed charges and floating charges.
- A fixed charge refers to a loan or mortgage of some kind that uses a fixed asset as collateral to secure loan repayment.
- Fixed assets that can be used as collateral in a fixed charge include land, machinery, buildings, shares, and intellectual property (patents, trademarks, copyrights, etc.).
- In the event that the borrower defaults on his loan, the bank can sell the fixed asset and recover their losses.
- The borrower/debtor cannot dispose the asset and the asset must be held by the borrower until the total loan repayment is made.
- A floating charge refers to a loan or mortgage on an asset that has a value that changes periodically to secure loan repayment.
- In this case, assets that do not have a constant value, or are not fixed assets such as stock inventory can be used.
- A mortgage is a contract between the lender and the borrower that allows an individual to borrow money from a lender for the purchase of housing.
- Mortgages apply for property that is immovable such as buildings, land, and anything that is permanently attached to the ground (this means that crops are not included in this category).
- A mortgage is also an assurance to the lender which promises that the lender can recover the loan amount even if the borrower defaults.
- The home that is being purchased is offered as security for the loan; which, in the event of default, will be seized and sold by the lender who will use sales proceeds to recover the loan amount.
- The possession of the property remains with the borrowers (as they will usually reside in their home).