Define mortgage

Mortgage Defined

Definition of mortgage

mortgage : A temporary, conditional pledge of property to a creditor as security for performance of an obligation or repayment of a debt.

Word History: The great jurist Sir Edward Coke, who lived from 1552 to 1634, has explained why the term mortgage comes from the Old French words mort, “dead,” and gage, “pledge.” It seemed to him that it had to do with the doubtfulness of whether or not the mortgagor will pay the debt. If the mortgagor does not, then the land pledged to the mortgagee as security for the debt “is taken from him for ever, and so dead to him upon condition, &c. And if he doth pay the money, then the pledge is dead as to the [mortgagee].” This etymology, as understood by 17th-century attorneys, of the Old French term morgage, which we adopted, may well be correct. The term has been in English much longer than the 17th century, being first recorded in Middle English with the form morgage and the figurative sense “pledge” in a work written before 1393.

Mortgage (amortising or reducing)
The principal and interest type loan which is the most common form of housing loan. The repayments through the term of the loan include both interest and principal.

Mortgage (Fixed or interest only loan)
The amount borrowed is not repaid until the end of the term of the loan. Repayments made are only payments of interest

Mortgage a)
A loan to purchase a home where the property is used as security in the event of non-payment of the mortgage.

Mortgage b)
A legal document which expresses the terms and conditions applying to the lending of money secured over real estate.

Mortgagee
The person(s) who lends the money.

Mortgagor
The person(s) who borrows the money.

Types of mortgage:

There are a huge number of different types of mortgage.

Fixed Rate
Capped
Discounted
Flexible Mortgages
Current Account Mortgages
Libor
Base Rate Tracker
100% Mortgages
CAT Standard
Daily Interest Mortgages
CCJs
High Income Multiplier Mortgages
Cashback Mortgages
First Time Buyer Mortgages
Remortgage
Buy to Let Mortgages
Self Employed Mortgages
Standard Variable
Arrears
Self Certificate Mortgages

There are different types of mortgage depending on what sort of person you are - if you're a first time buyer then you might be better off on a particular type of mortgage.

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