In Which Conditions Do Merchant Ships Get Mortgaged?

1- IN WHICH CONDITIONS DO SHIPS GET MORTGAGED?
1.1- A ship can be mortgaged to ensure a payment. Ship mortgage gives the creditor the authority to acquire their receivable amount from the ship value. The bottomry of registered ships is only made through ship mortgage. A mortgage can be made for an indirect claim or a claim bound to a condition or a negotiable paper.
1.2- The creditors’ right born from the ship mortgage can only be determined acording to their claim.
1.3- A ship’s share can only be limited with the condition that it is only the share of a holder who is the possessor according to the law of property.
1.4- A ship mortgage can not be made for different shares for different people if the possessor is holding all the shares.

2- IN WHICH CONDITIONS DO MERCHANT SHIPS GET MORTGAGED?
2.1- For ship mortgage the proprietor of the ship and the claimant needs to agree about the mortgage and the mortgage should be registered by ship registry.
2.2- The contracts related to ship mortgage need to be made in written form and their signatures need to be notarized. This contract can be made ship registry office. A contract won’t be valid unless it is made according to these conditions.
2.3- The respective persons can not avoid registering in case the contract is made according to the Law or it is declared that the proprietor approves of the claimant according to the Ship Registry Regulation or a registration petition is given to the registry office.
2.4- The proprietor’s power of disposition getting restricted later does not invalidate the registry’s approval or the registry request.
2.5- Ships that are acquired in a foreign country are considered registerd to flag certificate. While registering the ship these mortgages are legally registered.

Source: Turkish Commercial Law