An equitable mortgage is one in which the mortgagee has merely received an equitable interest. Equitable mortgages can arise (a) on an unregistered British ship or a share in such a ship, (b) on foreign vessels and (c) on unfinished vessels. An equitable mortgage can be created by a deposit of the legal deeds of a ship or it may be made by an agreement to create a legal mortgage in consideration of a loan being made. In terms of priority equitable mortgages rank between themselves in order of their creation. They always give way to statutory registered mortgages, even those created after an equitable mortgage. An equitable mortgage is not enforceable against a purchaser of a ship who takes possession without notice of the mortgage. Registered mortgages are always good against a purchaser even if the purchaser knew nothing of them. There is, however, no obligation to register a mortgage and the only significant benefit obtained from registering is that the mortgage concerned will rank for priority in front of earlier unregistered mortgages, later registered or unregistered mortgages, unregistered debentures created earlier and additional advances on a mortgage registered earlier under whose agreement present and future advances by the lender were covered. Registration is ‘notice to all the world’ and although failure to register does not invalidate the mortgage, it does oblige the lender to yield to later registered encumbrances. What is vital to remember is that it is the date of registration which is important and which sets the order of priorities, and not the date when the mortgage was created.