BP · VIDEOLECTURE

TYPES OF CHARGE AND SFB

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for VIDEO LECTURES OF ASHISH SIR (FOR ALL SCALES) — Bank Promotions.

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What is a 'charge' in the context of banking and secured lending?

A charge is a right created by a borrower in favour of a lender over the borrower's assets as security for repayment of a debt, giving the lender a claim over those assets in case of default.

What is a conditional sale mortgage under the Transfer of Property Act?

Mortgagor sells property conditionally, redeemable on repayment of debt.

What is the difference between a fixed charge and a floating charge?

A fixed charge is attached to a specific identified asset that the borrower cannot deal with freely, whereas a floating charge hovers over a class of assets (like stock-in-trade) that the borrower can use in the ordinary course of business until crystallisation.

What is an anomalous mortgage under Indian property law?

A mortgage that does not fall under any of the five defined types.

When does a floating charge crystallise?

A floating charge crystallises and becomes a fixed charge when a specific event occurs, such as the company going into liquidation, a receiver being appointed, or the borrower ceasing to carry on business.

What is the nature of a banker's lien on goods or securities?

It is an implied pledge giving the bank right to sell on default.

What is a pledge in banking security law?

A pledge is the bailment of goods by a borrower (pledgor) to a lender (pledgee) as security for a loan; the pledgee has possession of the goods and can sell them on default without court intervention.

What is the right of general lien available to bankers?

Right to retain all client securities until all dues are cleared.

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