A standard form third party legal mortgage over a property (often referred to as a legal charge) is usually granted by a company or an individual in favour of a lender, securing monies owed by another party to the lender. They are ‘a third party’ to the underlying loan agreement.

Similarly to an ordinary legal charge, it protects the money that the bank or a lender has lent to an individual or a company, and gives the lender the power of sale over the property, should the repayments not be met or there is an event of default.