mortgage

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Mortgage

A loan secured by the collateral of some specified real estate property which obliges the borrower to make a predetermined series of payments.

Mortgage

A loan used to buy real estate. A mortgage is secured by the property it is used to purchase. One must make monthly payments on a mortgage, and there is a set term before full payment is due, often 15, 20, or 30 years. Some mortgages have fixed interest rates, while others have variable interest rates. If one defaults on a mortgage, the bank making it may take possession of the real estate and sell it to recover its investment. Some banks, notably savings and loans, specialize in making mortgage loans. See also: Mortgage-backed security.

mortgage

A pledge of specific property as security for a loan. See also first mortgage, reverse annuity mortgage, second mortgage.

Mortgage.

A mortgage, or more precisely a mortgage loan, is a long-term loan used to finance the purchase of real estate.

As the borrower, or mortgager, you repay the lender, or mortgagee, the loan principal plus interest, gradually building your equity in the property.

The interest may be calculated at either a fixed or variable rate, and the term of the loan is typically between 10 and 30 years.

While the mortgage is in force, you have the use of the property, but not the title to it. When the loan is repaid in full, the property is yours. But if you default, or fail to repay the loan, the mortgagee may exercise its lien on the property and take possession of it.

mortgage

the advance of a LOAN to a person or business (the borrower/mortgagor) by other persons or businesses, in particular financial institutions such as BUILDING SOCIETIES and COMMERCIAL BANKS (the lender/mortgagee) which is used to acquire some asset, most notably a property such as a house, office or factory. A mortgage is a form of CREDIT which is extended for a specified period of time either on fixed INTEREST terms, or more usually, given the long duration of most mortgages, on variable interest terms. See SECOND MORTGAGE.

mortgage

the advance of a LOAN to a person or business (the borrower/mortgagor) by other persons or businesses, in particular financial institutions such as BUILDING SOCIETIES and COMMERCIAL BANKS (the lender/mortgagee) that is used to acquire some asset, most notably a property such as a house, office or factory. A mortgage is a form of CREDIT that is extended for a specified period of time, either on fixed INTEREST terms or, more usually, given the long duration of most mortgages, on variable interest terms.

The asset is ‘conveyed’ by the borrower to the lender as security for the loan. The deeds giving entitlement to ownership of the property remain with the building society or bank as collateral security (against default on the loan) until it is repaid in full, when they are transferred to the mortgagor who then becomes the legal owner of the property.

mortgage

A written document that provides a lender with rights in real property as collateral for a loan.The loan itself is evidenced by a promissory note, which is a written promise to repay money on certain terms and conditions. In common language, people refer to the whole relationship with the real estate lender as a mortgage, and you will see references in writing to “mortgage interest rates.”Technically, though, the reference should be to “mortgage loan interest rates.”

• In some states, the security instrument is called a deed of trust. The property owner actually deeds the property to a third party, who holds the naked legal title in trust for the owner and will reconvey (retransfer) it when the debt has been paid in full. If there is a default and foreclosure, the trustee will convey the property to the successful bidder. Such states usually allow nonjudicial foreclosures.

• In other states, the instrument called a mortgage creates only a lien on real property. The borrower is called the mortgagor, and the lender is called the mortgagee. In order to fore- close, the lender usually has to obtain court permission to conduct a sale. These are called judicial foreclosures.

• In a very few states, called hybrid states, the instrument called a mortgage transfers legal title to the lender itself. The title is extinguished when the debt has been paid in full. The lender may take advantage of nonjudicial foreclosure.

• If foreclosure nets less money than is owed on the note with all interest and costs of collection, then the lender can usually sue the borrower in state court for the balance, called a deficiency. Exceptions occur if the note provided that it was nonrecourse, meaning without any personal liability by the borrower, or if state laws prohibit deficiency judgments for first mortgages on a consumer's principal residence.

• In some states, a debtor has a grace period after foreclosure within which to buy the prop- erty back for the amount of the winning bid price plus interest at the legal rate for that state. These rights of redemption may also be extended to junior lienholders and even unsecured creditors, who may wish to invest the money necessary for redemption because they believe they can sell at a profit and recoup their losses.

Mortgage

A written document evidencing the lien on a property taken by a lender as security for the repayment of a loan.

The term “mortgage” or “mortgage loan” is used loosely to refer both to the lien and to the loan. In most cases, they are defined in two separate documents: a mortgage and a note.

References in periodicals archive ?
It was great for us that we could get a 100% mortgage.
Launchpad gives first-time buyers all the flexibility of renting with the ultimate ambition of purchasing the property at the end of the 12-month option, using all the money saved as a deposit to avoid the costly 100% mortgage option.
The average deposit being demanded of a first-time buyer stands at 25% - before the credit crunch some 100% mortgages were available.
The Council of Mortgage Lenders said more than 23,200 people who took out 100% mortgages in the year to March 31 could see falling house prices mean the amount they borrowed could be greater than the value of their properties.
The news comes as it was reported tens of thousands of people who took out 100% mortgages could face negative equity.
The bank's rules required first-time buyers to be prudent - they could no longer make the mistakes of those in previous years who had gained 100% mortgages - they ensured if you really wanted a home, you had to tighten your belt and provide a 10% deposit at least.
It is worth remembering 100% mortgages were available at that time to buy your council house which enabled many tenants to get on the property ladder and become home owners.
For those ready to make the move there's extra help in the shape of Chelford Homes' many incentive packages, such as a part exchange scheme, a shared equity scheme at 80%-20% on selected plots and 100% mortgages are also available.
Limits are still being drafted, but it is safe to say that the days of 100% mortgages are over, at least for now.
Other incentives include 100% mortgages, stamp duty relief, deposit-paid and shared equity schemes.
Although careful not to offer any contentious 100% mortgages, Northern Rock is planning to lend pounds 14bn in property loans over the next two years.
WITH the looming credit crunch and abandonment of 100% mortgages, first time buyers are struggling more than ever to get that essential first step on the property ladder.