• • • A mortgage loan, or simply mortgage, is used either by purchasers of to raise funds to buy real estate, or alternatively by existing property owners to raise funds for any purpose, while putting a on the property being mortgaged. The loan is ' on the borrower's property through a process known as. This means that a is put into place which allows the lender to take possession and sell the secured property (' or ') to pay off the loan in the event the borrower defaults on the loan or otherwise fails to abide by its terms. The word mortgage is derived from a ' term used by in the meaning 'death pledge' and refers to the pledge ending (dying) when either the obligation is fulfilled or the property is taken through foreclosure. 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 (for example, their own business premises, residential property let to tenants, or an ). The lender will typically be a financial institution, such as a, or, depending on the country concerned, and the loan arrangements can be made either directly or indirectly through intermediaries.
Features of mortgage loans such as the size of the loan, maturity of the loan, interest rate, method of paying off the loan, and other characteristics can vary considerably. The lender's rights over the secured property take priority over the borrower's other, which means that if the borrower becomes or, the other creditors will only be repaid the debts owed to them from a sale of the secured property if the mortgage lender is repaid in full first. In many jurisdictions, it is normal for home purchases to be funded by a mortgage loan. Few individuals have enough savings or liquid funds to enable them to purchase property outright.