What is mortgage

1. A mortgage is a loan used to purchase a property.

What is mortgage

1. Once the loan is fully paid off, the borrower owns the property outright.

What is mortgage

1. As the borrower makes payments, the loan balance decreases, and the borrower builds equity in the property.

What is mortgage

1. The interest is the cost of borrowing the money, and the principal is the amount borrowed.

What is mortgage

1. The borrower makes monthly payments to the lender, which include both the principal and interest on the loan.

What is mortgage

1. The lender disburses the funds for the loan, and the borrower uses them to purchase the property.

What is mortgage

1. The borrower makes a down payment, which is a percentage of the purchase price of the property.

What is mortgage

1. Once the lender approves the loan, the borrower and lender sign a mortgage agreement, outlining the terms of the loan and the borrower's responsibilities.

What is mortgage

1. The lender also orders an appraisal of the property to determine its value and ensure that it is worth at least as much as the loan being requested.

What is mortgage

1. The lender conducts a credit check and evaluates the borrower's financial situation to determine their ability to repay the loan.

What is mortgage

1. The property being purchased serves as collateral for the loan.

What is mortgage

1. The borrower makes monthly payments to the lender, which go toward paying off the loan over a specified period of time, typically 15 or 30 years.