A mortgage provides an interest in land as security for a loan or other obligation. It is the most common method of mortgage financing real estate transactions. The mortgagor is the party transferring the interest in land. The mortgage loan officer, usually the finance company in the mortgage process, is the provider of the loan or other interest given in exchange for the security interest.
Normally, mortgage payments are paid in installments that include both interest and a payment on the principle amount that was borrowed. Failure to make payments according to mortgage company regulations results in the foreclosure of the mortgage. Foreclosure allows the lenders to declare that the entire mortgage debt is due and must be paid immediately. This is accomplished through an acceleration clause in the mortgage allowed through mortgage lender laws. Failure to pay the mortgage debt once foreclosure of the land occurs leads to seizure of the security interest and it's sale to pay for any remaining mortgage debt. The list below are topics pertaining to foreclosure and predatory mortgage lending:
If the mortgage being foreclosed is not the only lien on the property then state law determines the priority of the property interests. For example, Article 9 of the Uniform Commercial Code governs conflicts between mortgages on real property and liens on fixtures (personal property attached to a piece of real estate). When a mortgage is a negotiable instrument it is governed by Article 3 of the Uniform Commercial Code. A mortgage may be used as a security interest by the mortgagee. Mortgage law is mainly governed by state statutory and common law. Federal agencies that purchase loans and mortgages are the Federal National Mortgage Association or Fannie Mae, the Federal Home Loan Mortgage Corporation or Freddie Mac, and the Government National Mortgage Association or Ginnie Mae. The federal government also insures mortgages through the Federal Housing Association and the Department of Veterans Affairs.
Be sure that you fully understand all of the conditions prior to signing any documents.
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