purchase money mortgage


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Purchase-Money Mortgage

A mortgage in which the home buyer borrows from the seller instead of, or in addition to, a bank or thrift. Purchase-money mortgages usually are made when the buyer cannot qualify for an ordinary home loan due to lack of credit or income. Alternately, a seller may offer a purchase-money mortgage in a mortgage-takeover agreement, that is, when the sale price of the home is equal to what remains on the seller's own mortgage.

purchase money mortgage

(1) A mortgage loan used to purchase real estate. It may be seller-financing, institutional lender financing, or any other type,as long as the loan proceeds were used to purchase the property. Some states prohibit lenders from suing borrowers on purchase money mortgages if a foreclosure sale does not result in enough money to pay the debt in full. (2) Sometimes used to refer to a purchase money security interest in personal property.Personal property security interests are sometimes called chattel mortgages, hence the expression purchase money mortgage. (3) In bankruptcy, the debtor may not keep normally exempt assets without paying the creditor if the creditor has a purchase money security interest.

References in periodicals archive ?
Purchase money mortgages offer significant benefits, but they also present additional risks, particularly for the seller, so it's important to plan carefully.
Because of this, efforts to address the inevitable market move to purchase money mortgages might have been put on the back burner.
A purchase money mortgage in the amount of $1,050,000 on a multi-family apartment building located in The Bronx N.
A purchase money mortgage in the amount of $1,000,000 on a multifamily apartment building located in Brooklyn, N.
A purchase money mortgage in the amount of $248,000 on a mixed-use building located in North Conway, N.
A purchase money mortgage in the amount of $430,000 on an apartment building located in Dover, NH.
A purchase money mortgage in the amount of $184,000 on an apartment building located in Fall River, Massachusetts.
A purchase money mortgage secured by a blanket mortgage on 5 multifamily buildings located in Troy, NY in the amount of $650,000.
In addition, a wholly-owned subsidiary of the company has entered into a $25 million purchase money mortgage loan with Boeing Capital.
But in the following quarters the numbers steadily rise well above average, before hitting an unprecedented high of 36 percent purchase money mortgages over the past three months.
Q: So, the target for low-income single-family purchase money mortgages is slightly higher because the expected range is higher than recent experience--and this higher target is in the median range of expected originations?
The lack of institutions extending real-estate financing has prompted the use of purchase money mortgages, better known as "seller financing.