The focus of this work is the examination of the problems and challenges associated with the use of land for as a collateral security for credit, especially as security of the interest of a mortgage and how far it can be guaranteed in Nigeria.

The paper explores the meaning of the term land, mortgage, its nature and creation as provided for under the relevant laws. It also examine the nature of Mortgagor's security on the mortgaged land and the effect of the Land Use Act on the mortgaged land.

An appraisal was also carried out of the efficacy of mortgage transaction within the provisions of the Land Use. The consent provisions, revocation and compensation all under the provisions of the Land Use Act were looked at in.

It was identified that the nature of a right of occupancy as a statutory lease almost a right sui generis and different from the lease at common law. Also, it is possible to have an efficient mortgage transaction under the Act if and only if challenges and vacuums created by the Act can be filled. More so, outright utilization of land a collateral security without perfection is effort in futility.