GA Code § 44-14-30 (2021)
2021 Georgia Code|Title 44 - Property|Chapter 14 - Mortgages, Conveyances to Secure Debt, and Liens|Article 2 - Mortgages|§ 44-14-30. Mortgage as Security Only; Effect on Title

 A mortgage in this state is only security for a debt and passes no title.   (Orig. Code 1863, § 1956; Code 1868, § 1944; Code 1873, § 1954; Code 1882, § 1954; Civil Code 1895, § 2723; Ga. L. 1899, p. 32, § 1; Civil Code 1910, § 3256; Code 1933, § 67-101.)   Law reviews.   - For article comparing rights of grantees holding deeds to secure debts against a bankrupt debtor to those rights of the mortgagee, and lienor, see 10 Ga. B.J. 5 (1947).   JUDICIAL DECISIONS    A mortgage or an assignment for security purposes creates a lien only and does not pass title. Walter E. Heller & Co. v. Aetna Bus. Credit, Inc., 158 Ga. App. 249, 280 S.E.2d 144 (1981).   Rule at common law.    - At common law the legal estate vested in the mortgage and was forfeited by default. The title passed to the mortgagee by the deed. Ward v. Lord, 100 Ga. 407, 28 S.E. 446 (1897).   Mortgage used both to refer to creating of lien and passing of title.    - Under law of this state, the word "mortgage" is used in a double sense. Sometimes it refers to a conveyance which creates a lien, and at others to one which passes title as security for a debt. Denton Bros. v. Shields, 120 Ga. 1076, 48 S.E. 423 (1904).   Instrument intended as security passes no title.    - An instrument containing a defeasance clause, describing the debt, and showing on its face that it is intended as security, is a mortgage, and passes no title under O.C.G.A. § 44-14-30. Lane v. Smart, 21 Ga. App. 292, 94 S.E. 325 (1917).   Trust deeds to be considered as mortgages.    - In equity, however it might be at law, it makes no substantial difference that mortgages are trust deeds in form and convey absolutely. They ought, in this forum and on a question of priority to be considered as mortgages pure and simple. So considered, they pass no title but are only securities for debts, under O.C.G.A. § 44-14-30. Green v. Coast Line R.R., 97 Ga. 15, 24 S.E. 814, 54 Am. St. R. 379, 33 L.R.A. 806 (1895).   Deeds and bills of sale to secure debt treated as equitable mortgages.    - The objects of a mortgage and security deed and a bill of sale to personalty are identical - security for debt. While recognizing the technical difference between a mortgage and security deed, deeds to secure debts, and bills of sale to secure debts are treated as equitable mortgages. Merchants' & Mechanics' Bank v. Beard, 162 Ga. 446, 134 S.E. 107 (1926).   Mortgages and conditional sales distinguished.    - If the relation of debtor and creditor remains, and a debt still subsists, it is a mortgage; but if the debt be extinguished by the agreement of the parties, or the money advanced was not by way of loan, and the grantor has the privilege of refunding, if the grantor pleases, by a given time, and thereby entitled grantor to a reconveyance, it is a conditional sale. Galt v. Jackson, 9 Ga. 151 (1850).   Mortgages and deeds to secure debt distinguished.    - A deed to secure a debt is not the same as a mortgage. Such a deed conveys title, while a mortgage is only a lien. Cole v. Cates, 110 Ga. App. 820, 140 S.E.2d 36 (1964).    A statutory mortgage in this state does not convey title, but only creates a lien on property. A statutory security deed conveys title to property as security, and is expressly declared to be not a mortgage. The latter has been declared to be in effect an equitable mortgage, but vastly different rights arise from the effect of the two classes of security. Merchants' & Mechanics' Bank v. Beard, 162 Ga. 446, 134 S.E. 107 (1926); Carmichael v. Citizens & S. Bank, 162 Ga. 735, 134 S.E. 771 (1926).   Instruments held to be mortgages despite provisions.    - A conveyance of real property, which recites that it is given for the purpose of indemnifying the grantee against loss resulting from an outstanding "mortgage" upon other property which the same grantor had conveyed to the same grantee, which contains no habendum clause, and which provides that when the mortgage referred to is paid, "then this deed shall be null and void," and which further provides that when this mortgage is paid "this deed shall become null and void and canceled on the record and surrendered to" the grantor, is not a security deed passing title to the grantee, but is a mortgage only. Camp v. Teal, 44 Ga. App. 829, 163 S.E. 233 (1932).   Instruments held to be security deeds despite provisions.    - An instrument otherwise in the form of a security deed is not a mortgage merely because it recites that it was given to secure an endorser upon a described note. The relationship of the parties does not make it a mortgage, nor is such recital a defeasance clause whereby the instrument should be treated as a mortgage and not as a security deed. Richey v. First Nat'l Bank, 180 Ga. 751, 180 S.E. 740 (1935).    Title reservation note for the price of property sold cannot by agreement be treated as a mortgage under O.C.G.A. § 44-14-30. Wynn & Robinson v. Tyner, 139 Ga. 765, 78 S.E. 185 (1913).    Deposit of deeds as collateral security for a debt does not create such a lien on the land as can be foreclosed at law. English v. McElroy, 62 Ga. 413 (1879).   Mortgage as basis of claim to property or proceeds.    - A mortgage does not pass title under O.C.G.A. § 44-14-30 and therefore cannot be made the basis of a claim to the mortgaged property; nor can the holder of an unforeclosed mortgage claim the proceeds of such property without showing equitable reasons entitling the holder to do so. Ennis v. Harralson Bros. & Co., 101 Ga. 282, 28 S.E. 839 (1897).    Parties cannot by agreement make the instrument one both retaining title and not retaining title. Wynn & Robinson v. Tyner, 139 Ga. 765, 78 S.E. 185 (1913).   Effect of conveyance to creditor of mortgaged property.    - Where a creditor, whose debt is secured by mortgage, takes a conveyance of the property mortgaged in satisfaction of such debt, such conveyance is not effectual to vest in the creditor a title which would prevail upon the trial of a claim afterwards filed by such creditor to prevent the sale of such property under an execution issued from a judgment, junior to the mortgage, but older than the deed. MacIntyre & Co. v. Ferst's Sons & Co., 101 Ga. 682, 28 S.E. 989 (1897).   Effect of mortgage where title in third person when executed.    - Where, according to the express recitals contained in a mortgage, the property described in the mortgage was not in the possession of the mortgagor at the time the instrument was executed, and the title thereto was vested in another person, the mortgage did not take effect then or thereafter as a valid, subsisting lien upon the property it purported to cover. Hogg v. Fuller, 17 Ga. App. 442, 87 S.E. 760 (1916).   Power of mortgagor to sell property named in mortgage.    - A contract by a mortgagee, made on receiving the mortgage, that the mortgagee will hold the securities, and that the mortgagor may sell the property named in said deeds and make titles thereto, the proceeds of the sale to go to the credit of the mortgagee, gives to the mortgagor power to sell for cash, free from the mortgage, but not to exchange for other lands. It does not cast upon the purchaser for cash the duty of seeing that the mortgagor appropriates the proceeds according to the agreement. Woodward v. Jewell, 140 U.S. 247, 11 S. Ct. 784, 35 L. Ed. 478 (1891).    Mortgagee cannot, by purchase of mortgaged property, divest an intervening title of which notice is had. MacIntyre & Co. v. Ferst's Sons & Co., 101 Ga. 682, 28 S.E. 989 (1897); Booze v. Neal, 6 Ga. App. 279, 64 S.E. 1104 (1909); Hudson v. Gunn, 20 Ga. App. 95, 92 S.E. 546 (1917).   Acquisition of rights adverse to mortgagor by one holding title under mortgagor.    - One holding title under mortgagor cannot acquire interest in the property adverse to rights of the mortgagee of which that person had previous notice. Hudson v. Gunn, 20 Ga. App. 95, 92 S.E. 546 (1917).    Power of sale given by mortgage is revoked by mortgagors' death before the note fell due. Wilkins v. McGehee, 86 Ga. 764, 13 S.E. 84 (1891).    Power of sale in a security deed, being coupled with an interest, is not revoked by grantor's death. Roland v. Coleman & Co., 76 Ga. 652 (1886).   Reversion to grantor upon payment of indebtedness.    - Where the title, if any, conveyed by the terms of a deed amounting to a mortgage would terminate, by the terms of the deed, upon the deed's becoming null and void on payment of the mortgage indebtedness referred to therein, the title then, by the terms of the deed, would revert to the grantor, notwithstanding that a clause in the deed, that upon the payment of the mortgage debt "this deed shall become null and void and canceled on the record and surrendered to" the grantor, may not amount to a defeasance. Camp v. Teal, 44 Ga. App. 829, 163 S.E. 233 (1932).   Possession under mortgage as defense to ejectment.    - A mortgage in this state is only a lien, and conveys no title. Possession by virtue of it, therefore, furnishes no defense against an action of ejectment by the holder of the title. Phillips v. Bond, 132 Ga. 413, 64 S.E. 456 (1909).    Cited in Jackson v. Carswell, 34 Ga. 279 (1866); Tucker v. Toomer, 36 Ga. 138 (1867); Peyton v. Lamar, 42 Ga. 131 (1871); Chisolm v. S.B. Chittenden & Co., 45 Ga. 213 (1872); Anderson v. Howard & Sims, 49 Ga. 313 (1873); Murphy v. Vaughan, 55 Ga. 361 (1875); Stephens v. Tucker, 55 Ga. 543 (1875); Frost v. Allen, 57 Ga. 326 (1875); Vason v. Ball, 56 Ga. 268 (1876); Lathrop & Co. v. Brown, 65 Ga. 312 (1880); Cully v. Bloomingdale, Rhine & Co., 68 Ga. 756 (1882); Brady v. Brady, 71 Ga. 71 (1883); Miller v. McDonald, 72 Ga. 20 (1883); Wofford v. Wyly, 72 Ga. 863 (1884); Thomas v. Morrisett, 76 Ga. 384 (1886); Wardlaw v. Mayer, Son & Co., 77 Ga. 620 (1886); Green v. Coast Line R.R., 97 Ga. 15, 24 S.E. 814, 54 Am. St. R. 379, 33 L.R.A. 806 (1895); Mixon v. Stanley, 100 Ga. 372, 28 S.E. 440 (1897); Georgia S. & Fla. Ry. v. Barton, 101 Ga. 466, 28 S.E. 842 (1897); Ainsworth v. Mobile Fruit & Trading Co., 102 Ga. 123, 29 S.E. 142 (1897); Lubroline Oil Co. v. Athens Sav. Bank, 104 Ga. 376, 30 S.E. 409 (1898); Hill v. O'Bryan Bros., 104 Ga. 137, 30 S.E. 996 (1898); Durant v. Duchesse D'Auxy, 107 Ga. 456, 33 S.E. 478 (1899); Clark Bros. v. McNatt, 132 Ga. 610, 64 S.E. 795, 26 L.R.A. (n.s.) 585 (1909); Powers & Co. v. Georgia-Florida Grocery Co., 7 Ga. App. 592, 67 S.E. 685 (1910); In re Caldwell, 178 F. 377 (S.D. Ga. 1910); Penton v. Hall, 140 Ga. 235, 78 S.E. 917 (1913); Hogg v. Fuller, 17 Ga. App. 442, 87 S.E. 760 (1916); Real Estate Bank & Trust Co. v. Baldwin Locomotive Works, 145 Ga. 831, 90 S.E. 49 (1916); Bacon v. Hanesley, 19 Ga. App. 69, 90 S.E. 1033 (1916); Hudson v. Gunn, 20 Ga. App. 95, 92 S.E. 546 (1917); Smith v. Long Cigar & Grocery Co., 21 Ga. App. 730, 94 S.E. 905 (1918); Dixon v. Pierce, 22 Ga. App. 291, 95 S.E. 995 (1918); McBride v. Gibbs, 148 Ga. 380, 96 S.E. 1004 (1918); Southern Ry. v. Lancaster, 149 Ga. 434, 100 S.E. 380 (1919); National City Bank v. Adams, 30 Ga. App. 219, 117 S.E. 285 (1923); Dunson & Bros. Co. v. Unity Cotton Mills, 34 Ga. App. 768, 131 S.E. 186 (1926); Merchants' & Mechanics' Bank v. Beard, 162 Ga. 446, 134 S.E. 107 (1926); Hirsch v. Northwestern Mut. Life Ins. Co., 191 Ga. 524, 13 S.E.2d 165 (1941); Alropa Corp. v. Goldstein, 69 Ga. App. 168, 25 S.E.2d 116 (1943); Bayview Loan Servicing, LLC v. Baxter, 312 Ga. App. 826, 720 S.E.2d 292 (2011); Detention Mgmt., LLC v. UMB Bank, NA (In re Mun. Corr., LLC), 501 Bankr. 119 (Bankr. N.D. Ga. 2013).   RESEARCH REFERENCES   Am. Jur. 2d.   - 55 Am. Jur. 2d, Mortgages, § 1.   C.J.S.   - 59 C.J.S., Mortgages, § 1.   ALR.    - Provision in land contract against removal of buildings as affecting rights of third person under chattel mortgage or conditional sale, 30 A.L.R. 542.    Mortgagor's statutory right to redeem or his right to possession after foreclosure as subject of levy and seizure by creditors, 42 A.L.R. 884; 57 A.L.R. 1128.    Rights in abstract of title held by mortgagee, 44 A.L.R. 1332.    Right to receive rent as between mortgagor and mortgagee of leased premises, 105 A.L.R. 744.   Lien as estate or interest in land within venue statute, 2 A.L.R.2d 1261.   Assumption of mortgage as consideration for conveyance attacked as in fraud of creditors, 6 A.L.R.2d 270.   Recovery by chattel mortgagee or mortgagor, or person standing in his shoes, against third person for damage or destruction of property, 67 A.L.R.2d 1599.   Validity and construction of provision of mortgage or other real-estate financing contract prohibiting prepayment for a fixed period of time, 81 A.L.R.4th 423.