What is a caveat?

A caveat is a caveat-able interest in property lodged at LINZ to protect an unregistered interest in the property.

When a lender refers to a caveat they refer to an ‘agreement to mortgage’ entered into by a guarantor. This in itself is not a piece of security but the right for the lender to oblige the guarantor to enter into an agreement (ie the mortgage).

When the caveat is registered with LINZ it will prevent the property being sold or a mortgage being taken over the property without the lender’s consent.

What is a Specific Security Agreement (SSA)?

An SSA is a security interest over a particular asset.  

This security is perfected when it is registered on the Personal Property Security Register. The asset must be uniquely identifiable to be secured on the PPSR.  Homogeneous products like stock etc can therefore not have a SSA registered against them.

It will accompany a loan agreement and allow the lender to take control of the asset which the SSA is registered over.  In the case of a vehicle (for instance) this would allow the lender to repossess and sell the vehicle in the event of loan default.

A company may have several GSA's registered over it but the first GSA holder takes priority in enforcement and collection.

What is a General Security Agreement (GSA)?

A GSA is a security interest over a company or an individual.  

This security is perfected when it is registered on the publicly view-able Personal Property Security Register. 

It will accompany a loan agreement and allow the lender to take control of the asset which the GSA is registered over.  In the case of a company this would be the appointment of a receiver.

A company may have several GSA's registered over it but the first GSA holder takes priority in enforcement and collection.