Mortgage

At common law, a mortgage was a conveyance that on its face was absolute and conveyed a fee simple estate, but which was in fact conditional, and would be of no effect if certain conditions were met --- usually, but not necessarily, the payment of a debt by the original landowner. Hence the word "mortgage," Law French for "dead pledge;" that is, it was absolute in form and in theory required no further steps to be taken by the creditor.

In many U. S. states, however, a mortgage has been converted by statute to a device for creating a security interest in land. When the landowner fails to perform on the obligation secured by the mortgage, the mortgage holder must file a foreclosure to cause the property to be sold at auction, usually by the sheriff. Since mortgage debt is often the largest debt owed by the debtor, banks and other mortgage lenders run title searches of the real property to make certain that the lien of the mortgage is prior to anyone else's claim.

Mortgage lending is a major category of the business of finance in the United States of America. Mortgages are commercial paper and can be conveyed and assigned freely to other holders. In the USA the Home Owners Loan Corporation, the Federal Housing Administration administer the programmes colloquially known as "Ginnie Mae" and "Freddie Mac" to foster mortgage lending and thus to encourage home ownership and construction.

See also : Deed, mortgagee, mortgagor, pre-qualification and pre-approval

External links

• Mortgage Calculator with dynamic diagrams. This mortgage calculator can be used to figure out monthly payments of a home mortgage loan. It factors in PMI (Private Mortgage Insurance), town property taxes, and their effect on the total monthly mortgage payment. The calculations are visualized with the aid of two diagrams, displaying the remaining balance and monthly paid interest vs. monthly paid principal respectively, both on a month/money coordinate system.

• MortgageSorter. This recommended site offers information and a free guide to mortgages in the UK.

Referenced By