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Mortgage And Security Agreement for Malaysia

Mortgage And Security Agreement Template for Malaysia

A comprehensive legal document governed by Malaysian law that creates a security interest over real property in favor of a lender. The agreement establishes the terms and conditions of the mortgage, including the secured obligations, enforcement rights, and borrower's covenants, while complying with the requirements of the National Land Code 1965 and other relevant Malaysian legislation. It includes specific provisions for property maintenance, insurance requirements, default scenarios, and remedies available to the lender under Malaysian law.

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Mortgage And Security Agreement

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What is a Mortgage And Security Agreement?

The Mortgage and Security Agreement is a fundamental document in Malaysian property financing, used when a borrower pledges real property as security for a loan. This document is essential for both residential and commercial property transactions in Malaysia, combining elements of property law, banking regulations, and security requirements under Malaysian jurisdiction. It must comply with the National Land Code 1965, Financial Services Act 2013, and other relevant legislation, while also meeting Central Bank of Malaysia guidelines. The agreement typically includes detailed provisions about the property, loan terms, security creation, borrower's obligations, lender's rights, and enforcement mechanisms. For Islamic financing, specific Shariah-compliant versions are used to meet religious and regulatory requirements.

What sections should be included in a Mortgage And Security Agreement?

1. Parties: Identification of the mortgagor (borrower/chargor) and mortgagee (lender/chargee) with full legal names and registration/identification numbers

2. Background: Recitals explaining the context of the loan, property ownership, and agreement to create security

3. Definitions and Interpretation: Definitions of key terms and interpretation rules, including Malaysian law-specific terminology

4. Facility Details: Description of the loan facility, amount, interest rate, and terms of repayment

5. Creation of Security: Legal provisions creating the charge/mortgage over the property in accordance with Malaysian law

6. Representations and Warranties: Borrower's declarations regarding property ownership, authority to create security, and absence of encumbrances

7. Covenants: Positive and negative obligations of the borrower regarding property maintenance, insurance, and restrictions on dealing

8. Events of Default: Circumstances constituting default and triggering enforcement rights

9. Enforcement Rights: Lender's rights and remedies upon default, including power of sale under Malaysian law

10. Insurance: Requirements for property insurance and assignment of insurance policies

11. Costs and Expenses: Allocation of legal fees, stamp duty, and other costs

12. Notices: Requirements for valid service of notices between parties

13. General Provisions: Standard boilerplate clauses including governing law, jurisdiction, and severability

What sections are optional to include in a Mortgage And Security Agreement?

1. Assignment and Transfer: Include when the lender requires right to assign or transfer the security to another financial institution

2. Corporate Authorization: Required for corporate borrowers, including board resolutions and constitutional requirements

3. Guarantee: Include when there are personal or corporate guarantors securing the facility

4. Additional Security: When other forms of security (like debentures or assignments) are created alongside the mortgage

5. Islamic Banking Provisions: Required for Shariah-compliant mortgages, including specific terms for Islamic financing structures

6. Property Development Provisions: Include for properties under construction, with stage payment and developer obligations

7. Multiple Properties: Special provisions when the security covers more than one property

8. Power of Attorney: Optional appointment of lender as attorney for specific purposes

What schedules should be included in a Mortgage And Security Agreement?

1. Property Schedule: Detailed legal description of the property including title details, lot number, and land office registration

2. Facility Terms: Detailed terms of the loan facility including repayment schedule and interest calculations

3. Security Documents: List of all security documents required to be executed

4. Insurance Requirements: Specific insurance requirements including types of coverage and minimum amounts

5. Form of Transfer/Assignment: Standard forms for transfer or assignment of the security interest

6. Special Conditions: Any special conditions or requirements specific to the property or borrower

7. Execution Requirements: Specific execution formalities required under Malaysian law

8. Power of Attorney: Form of power of attorney if required

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Malaysia

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions






























Clauses
























Relevant Industries

Banking and Financial Services

Real Estate

Property Development

Insurance

Legal Services

Construction

Housing Development

Islamic Finance

Relevant Teams

Legal

Credit Risk

Real Estate

Compliance

Islamic Banking

Property Finance

Security Documentation

Mortgage Operations

Corporate Banking

Retail Banking

Relevant Roles

Legal Counsel

Property Lawyer

Banking Officer

Mortgage Officer

Credit Risk Manager

Real Estate Manager

Compliance Officer

Property Valuer

Financial Advisor

Islamic Banking Specialist

Security Documentation Officer

Real Estate Developer

Property Investment Manager

Land Registration Officer

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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