Mortgage Loans

Kesha Janzen

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What is it?

A mortgage loan is a loan secured by real property through the use of a mortgage note which evidences the existence of the loan and the right of that reality through the granting of a mortgage which secures the loan.

Meaning of Mortgage

Mortgage is a Old French word. Mort meaning dead and gage meaning pledge. This means "dead pledge" because you are pledging it now, but it will die when you pay it off.


The transferring of the house title to the bank to secure the loan is essentially a mortgage. This is a security for the bank just in case the homeowner bails.


Lets say that you would like to buy a house worth $500,000. You have saved up $125,000 in your savings account. The first step is to go to a bank and ask them to lend you a loan for the rest of the payment of the house you want. Essentially the bank owns the title of the house until you pay off the loan. The homeowner can live in the house and do whatever he or she wants, but the bank still is on the title of the house.
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This video comes from the Khan Academy and will explain more in depth about all the math that goes into mortgage loans.