Which type of mortgage would typically carry a higher risk for lenders?

Chattel mortgages are designed for personal property, such as vehicles or equipment, rather than real estate. This type of mortgage carries a higher risk for lenders because the value and market demand for personal property can be more volatile and unpredictable compared to real estate. If a borrower defaults, it may be more difficult for the lender to recover the full value of the asset, especially if the property devalues or if there are other encumbrances on it.

In contrast, legal mortgages typically involve real estate, which tends to appreciate over time and provides more security for the lender. Equitable mortgages also relate to real estate but focus on the rights of the parties and may involve situations where a formal legal document is not present. Fixed-rate mortgages, while they do carry some risk due to interest rate fluctuations, offer a stable repayment structure over time, making them less risky from a lender's perspective compared to chattel mortgages.

Overall, the nature of chattel mortgages, tied to personal property, inherently carries a higher risk for lenders because of the factors influencing collateral recovery.