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A mortgage can also be described as "a borrower giving consideration in the form of a collateral for a benefit (loan)". Mortgage borrowers can be individuals mortgaging their home or they can be businesses mortgaging commercial property (for example, their own business premises, residential property let to tenants, or an investment portfolio).
For example, Alice acquires a 3-acre (12,000 m 2) lot by mortgage then splits up the lot into three 1-acre (4,000 m 2) lots (X, Y, and Z), and sells lot Y to Bob, and then lot Z to Charlie, retaining lot X for herself. Upon default, the mortgagee proceeds against lot X first, the mortgagor.
The recipient, or borrower, incurs a debt and is usually required to pay interest for the use of the money. The document evidencing the debt (e.g., a promissory note ) will normally specify, among other things, the principal amount of money borrowed, the interest rate the lender is charging, and the date of repayment.
The mortgage (or deed of trust). This is the document that serves as security for the loan. ... For example, say you buy a house for $500,000 with a $100,000 down payment and a $400,000 mortgage ...
If you still have a traditional mortgage, you can use a reverse mortgage to pay it off, eliminating your monthly mortgage payments. ... For example, a $100,000 reverse mortgage at 7.5% could grow ...
The Federal National Mortgage Association (FNMA), colloquially known as Fannie Mae, is a Congressionally-chartered enterprise that acts as a major player in the mortgage industry.
A blanket mortgage can be refinanced just like any other mortgage. It also allows the borrower to sell one property from the group but retain the loan for the others.
This in turn allows the public to use these mortgages to purchase homes, something the government wishes to encourage. Investors in conforming loans, meanwhile, gain low-risk income at a higher interest rate (essentially the mortgage rate, minus the cuts of the bank and GSE) than they could gain from most other bonds.