Ships' Mortgage Laws

Ships' mortgage laws govern how ships can be used as collateral for loans. When a shipowner borrows money to buy or maintain a vessel, the lender can take a legal claim on the ship, known as a “mortgage.” If the owner fails to repay, the lender can seize the ship to recover the debt. These laws ensure that transactions are clear and enforceable, protecting both lenders and shipowners. They typically involve registration of the mortgage to establish priority over any other claims, similar to mortgages on property in real estate.