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Mortgage: basic concepts

If you are new to the concept of the mortgage loan you should refer to two or three sources to get the basic idea of it. Briefly formulated, a mortgage (as it’s commonly referred to in everyday use) is a type of a loan used as a tool for buying property. Such a loan is provided on specific conditions, and the most important part of it is that the loan must be secured by real residential property. A mortgage should be taken as a legal instrument of buying residential property.

As any other loan, a mortgage loan (literally “financing”) is obtained from a financial institution. It could be a bank, a credit union, financial fund, etc. Quite often a mortgage loan can be obtained through an intermediary. Have you ever heard about mortgage brokers? That’s exactly what they do – work as the linking chain between the mortgage applicant and the mortgage institution (commonly referred to as mortgage lender).

What features are typical of mortgage loans? There are plenty of them, and all are quite important.

• the size of the mortgage loan

• the term of the mortgage loan

• mortgage loan interest rate

• maturity of the mortgage loan

• ways of paying off the mortgage loan

There are many more and most of them will be considered in the articles on our website. At this point we have accumulated a bit of general mortgage oriented information which will soon be developed into a more serious project covering all possible aspects of the mortgage procedure.