A mortgage loan is a secured loan used to finance property. Mortgage loans are secured because the person borrowing money assures payment through collateral, which in most cases is the home. Loans backed by collateral typically allow borrowers to receive more favorable interest rates.
Mortgage loans also protect the lender, as they can sell the property if the borrower defaults on his or her loan. A default occurs when the borrower fails to make payments to the lender according to the initial arrangement.
Related Articles:
What Do I Do If I Want a New Mortgage Loan Before the Other Is Paid Off?
How to Calculate Your Mortgage
Should I Have Someone Cosign On My House to Build Credit?
