Document background
The Mortgage Lease Agreement is a specialized legal instrument used in Indian property transactions where a mortgaged property is being leased to a tenant. This document becomes necessary when a property owner who has mortgaged their property (or intends to do so) wishes to generate rental income by leasing the property, while ensuring the security interests of the lending institution are protected. The agreement must comply with multiple Indian legislations including the Transfer of Property Act, SARFAESI Act, and state-specific property laws. It typically includes comprehensive terms covering mortgage conditions, lease provisions, maintenance responsibilities, default remedies, and the interrelationship between all three parties' rights and obligations. The document requires careful drafting to balance the mortgagee's security interests with the lessee's right to peaceful enjoyment of the property, while protecting the mortgagor's interests as both borrower and landlord.
