l. A conveyance of title to property that is given as security for the payment of a debt or the performance of a duty and that will become void upon payment or performance according to the stipulated terms. — aka (archaically) dead pledge.
2. A lien against property that is granted to secure an obligation (such as a debt) and that is extinguished upon payment or performance according to stipulated terms.
3. An instrument (such as a deed or contract) specifying the terms of such a transaction.
4. Loosely, the loan on which such a transaction is based.
5. The mortgagee’s rights conferred by such a transaction.
6. Loosely, any real property security transaction, including a deed of trust. — Abbr. M. — mortgage, vb.
“The chief distinction between a mortgage and a pledge is that by a mortgage the general title is transferred to the mortgagee, subject to be revested by performance of the condition; while by a pledge the pledgor retains the general title in himself, and parts with the possession for a special purpose. By a mortgage the title is transferred; by a pledge, the possession.” Leonard A. Jones, A Treatise on the Law of Mortgages 5 4, at 5~6 (5th ed. 1908).
adjustable-rate mortgage. (1975) A mortgage in which the lender can periodically adjust the mortgage’s interest rate in accordance with fluctuations in some external
market index. -Abbr. ARM. –Also’ termed variable
rate mortgage; flexible-rate mortgage. Cf. exploding adjustable-rate mortgage. ’ ‘ l
b all-inclusive mortgage. See wrapamund mortgage.
> amortized mortgage. (1913) A mortgage in which the mortgagor pays the interest as well as a portion of the principal in the periodic payment. 0 At maturity, the periodic payments will havecompletely repaid the loan. -Also termed self-liquidating mortgage. See AMORTIZATION (1). Cf. straight mortgage.
> balloon-payment.mortgage. (1978) A mortgage requiring periodic payments for a specified time and a lump-sum payment of the outstanding balance at maturity.
r blanket mortgage. (1878) A mortgage that covers an aggregation of property or that secures or provides for indebtedness previously existing in various forms; esp, a mortgage covering two or more properties that are pledged to support a debt.
v bulk mortgage. (1919) 1. A mortgage of personal property in bulk; a pledge of an aggregate of goods in
one location. 2. A mortgage of more than one real-estate parcel.
chattel mortgage (chat-91). (1841) A mortgage on goods purchased on installment, whereby the seller transfers title to the buyer but retains a lien securing the unpaid balance. 0 Chattel mortgages have generally been replaced by security agreements, which are governed by Article 9 of the UCC. Cf. retail installment contract
> closed-end mortgage. (1954) A mortgage that does not permit either prepayment or additional borrowing against the collateral. Cf. open-end mortgage. –Also termed closed mortgage.
> closed mortgage. See closed-end mortgage.
v collateral mortgage. (1853) Civil law. A mortgage securing a promissory note pledged as collateral security for a principal obligation.
b common-law mortgage. See deed of trust under DEED.
> consolidated mortgage. (1874) A mortgage created by combining two or more mortgages.
> construction mortgage. (1893) A mortgage used to finance a construction project.
contingenteinterest mortgage. (1983) A mortgage whose interest rate is directly related to the economic performance of the pledged property
5 contribution mortgage. (1928) l. A mortgage in which the land secured is developed using the money raised from investors. 2. A mortgage in which the money secured lS advanced by more than one lender 1n separate
5 contributory mortgage. (1878) A mortgage for which there is more than one lender. See participation mortgage (2).
> conventional mortgage. (1822) A mortgage, not backed by government insurance, by which the borrower trans~ fers a lien or title to the lending bank or other financial institution. 0 ThesLe mortgages, which feature a fixed periodic payment of principal and interest throughout
the mortgage term, are typically used for home frnano ing. Also termed conventidnal loan.
> current-account mortgage. See ofset mortgage.
b direct-reduction mortgage. (1935) An amortized mortgage in which the principal and interest payments are paid at the same time -usu. monthly 1n equal
amounts -With interest being computed on the remaining balance. Abbr. DRM.
> dry mortgage. (1974) A mortgage that creates a lien on property but does not impose on the mortgagor any personal liability for any amount that exceeds the value of the premises.
equitable mortgage. (1827) A transaction that has the intent but not the form of a mortgage, and that a court
of equity will treat as a mortgage. Cf. technical mortgage.
“Courts of equity are not governed by the same principles as courts of law in determining whether a mortgage has
been created, and generally, whenever a transaction resolves itself into a security, or an offer or attempt to pledge land as security for a debtor liability, equity will treat it as a mortgage, without regard to the form it may assume, or the name ‘the parties may choose to give it. The threshold issue in an action seeking imposition of an equitable mortgage is whether the plaintiff has an adequate remedy at law. In applying the doctrine of equitable mortgages doubts are resolved in favor of the transaction being a mortgage.” 59 C.J.S. Mortgages 5 12-, at 62 (1998).
> exploding adjustable-rate mortgage. (2007) An adjustable-rate mortgage for which the lender resets the interest rate so high that the borrower can no longer
make payments. Sometimes shortened to exploding ARM. Cf. adjustable-rate mortgage. “
> extended first mortgage. See wraparound mortgage.
> FHA mortgage. (1938) A mortgage that is insured fully or partially by the Federal’Housing Administration.
> first mortgage. A mortgage that is senior to all other mortgages on the same property.
> fixed-rate mortgage. (1971) A mortgage with an interest rate that remains the same over the life of the mortgage regardless of market conditions. ~Abbr. FRM.
> flexible-rate mortgage. 1. See adjustable-rate mortgage. 2. See renegotiable-rate mortgage.
> flip mortgage. (1987) A graduated-payment mortgage allowing the borrower to place all or some of the down payment in a savings account and to use the principal
and interest to supplement lower mortgage payments in the loan’s early years.
.future-advances mortgage. (1967) A mortgage in which part of the loan proceeds will not be pa1d until a future date.
.general mortgage. (1822) Civil law. A blan et mortgage against all the mortgagor’ 5 present and future property La. Civ. Code art. 3285.
p graduated mortgage. See graduated-payment mortgage.
p graduated-payment adjustable-rate mortgage. (1983) A mortgage combining features of the graduated-payv
ment mortgage and the adjustable-rate mortgages-Abbr. GPARM.Also termed graduated mortgage
r graduated-payment mortgage. (1977) A mortgage whose initial payments are lower than its later payments. 0 The payments are intended to gradually Increase, as the borrower 3 income increases over time.
> growing-equity mortgage. (1982) A mortgage that 18 fully amortized over a significantly shorter term than the traditional 25 to 30-year mortgage, with increasing payments each year -Abbr. GEM.
> indemnity mortgage. See deed of trust under DEED
> interest-only mortgage. (1971) A balloon-payment mortgage on which the borrower must at first make only interest payments, but must make a lump-sum payment of the full principal at maturity. —Abbr. IO mortgage. -Also termed standing mortgage; straightterm mortgage.
> joint mortgage. (1846) A mortgage given to two or more mortgagees jointly.
b judicial mortgage. (1822) Civil law. A judgment lien created by a recorded legal judgment.
jumbo mortgage. ( 1983) A mortgage loan 1n a principal amount that exceeds the dollar limits for a government
p junior mortgage. (1851) A’mortgage that is subordiv nate to another mortgage on the same property. -Also termed puisne mortgage.
v leasehold mortgage. (1908) A mortgage secured by a lessee s leasehold interest.
r legal mortgage. (1822) Civil law. A creditor’s mortgage
arising by operation of law on the debtor’s property. Also termed tacit mortgage.
> offset mortgage. (1989) English law. A flexible mortgage, common in the United Kingdom, 1n which the interest payment is reduced by offsetting against the mortgage debt the balance of the borrower’s savings or other deposit accounts at the same institution. 0 For example, if the mortgage principal is $200,000 and the borrower has $30, 000 1n a savings account, the mortgage interest would be calculated based on $170, 000. -Also termed
current-account mortgage. ‘
> open-end mortgage. (1927 ) A mortgage that allows the mortgagor to borrow additional funds against the same property. Cf. closed-end mortgage.
> package mortgage. (1948) A mortgage that includes both real and incidental personal property. such as a refrigerator or stove.
participation mortgage. (1917) l. A mortgage that permits the lender to receive profits of the venture in addition to the normal interest payments. 2. A mortgage held by more than one lender. -Also termed (in sense
2) participating mortgage; contributory mortgage.
> price~levelaadjusted mortgage. (1978) A mortgage with a fixed interest rate but the principal balance of which is adjusted to reflect inflation. –Abbr. PLAM.
b puisne mortgage. See junior mortgage.
> purchase-money mortgage. (1858) A mortgage that a buyer gives the seller, when the property is conveyed, to secure the unpaid balance of the purchase price. –Abbr. PMM. See SECURITY AGREEMENT.
> reincarnated mortgage. Slang. See zombie mortgage.
> renegotiable-rate mortgage. (1980) A governmentsponsored mortgage that requires the mortgagee to renegotiate its terms every three to five years, based on market conditions. -Also termed flexible-rate mortgage; rollover mortgage.
breverse annuity mortgage. (1978) A mortgage in which the lender disburses money over a long period to provide regular income to the (usu. elderly) borrower, and in which the loan is repaid in a lump sum when the borrower dies or when the property is sold. -Abbr. RAM. -Also termed reversemortga’ge.
> rollover mortgage. See renegotiable-ra te mortgage.
p second mortgage. (1959) A mortgage that is junior to a first mortgage on the same property, but that is senior to any later mortgage.
“A landowner who already holds land subject to a mortgage may wish to hypothecate his equity. He does this by taking out a ‘second mortgage.’ Should the mortgagor default in his obligation on the first mortgage, the first mortgagee may foreclose. If there is a deficiency upon sale, the second mortgagee loses his security in the equity because there is no equity. if the mortgagee does not default on the first mortgage, but does on the second, the second mortgagee can foreclose on the mortgagor’s equity. Such a foreclosure would not affect the first mortgagee’s rights.” Edward H. Rabin, Fundamentals of Modern Real Property Law 1087 (1974).
self-liquidating mortgage. See amortized mortgage.
> senior mortgage. (1856) A mortgage that has priority over another mortgage (a junior mortgage) on the same
property. > shared-appreciation mortgage. (1981) A mortgage
giving the lender the right to recover (as contingent
interest) an agreed percentage of the property’s appreciation in value when it is sold or at some other specified,
future date. -Abbr. SAM.
> shared-equity mortgage. (1981) A mortgage in which the lender shares in the profits from the property’s resale. O The lender must usu. first purchase a portion of the property’s equity by providing a portion of the down payment.
> special mortgage. (1822) Civil law. A mortgage burdening only particular, specified property of the mortgagor. La. Civ. Code art. 3285.
> standing mortgage. See interest-only mortgage.
> straight mortgage. (1906) A mortgage in which the mortgagor is obligated to pay interest during the
mortgage term along with a final pa ment of principal at the end of the term. Cf. amortize mortgage.
, straight-term mortgage. See interest-only mortgage.
> submortgage. (1825) A mortgage created when a person holding a mortgage as security for a loan procures another loan from a third party and pledges the mortgage as securit ; a loan to a mortgagee who puts up the mortgage as col ateral or security for the loan.
r tacit mortgage. See legal mortgage.
v technical mortgage. (1848) A traditional, formal mortgage, as distinguished from an instrument having
the character of an equitable mortgage. Cf. equitable mortgage.
> VA mortgage. (1950) A veteran’s mortgage that is guar. anteed by the Veterans Administration.
> variable-rate mortgage. See adjustable-rate mortgage.
b Welsh mortgage. (1829) A type of mortgage, formerly common in Wales and Ireland, by which the mortgagor, without promising to pay the debt, transfers title and possession of the property to the mortgagee, who takes the rents and profits and applies them to the interest, often with a stipulation that any surplus will reduce the principal. O The mortgagee cannot compel the mortgagor to redeem, and cannot foreclose the right to redeem, because .no time is fixed for payment. The mortgagor is never in default, but may redeem at any time.
> wraparound mortgage. (1967) A second mortgage issued when a lender assumes the payments on the borrower’s low~interest first mortgage (usu. issued through a different lender) and lends additional funds. 0 Such a mortgage covers both the outstanding balance of the first mortgage and the additional funds loaned. 12 CFR
§ 226.17 cmt. 6. –Also termed extended first mortgage; all-inclusive mortgage.
p zero-rate mortgage. (1981) A mortgage with a large down payment but no interest payments, with the balance paid in equal installments.
> zombie mortgage. Slang. A mortgage that has been paid in full but remains active because there is no record that it was paid off. Also termed reincarnated mortgage.
r -mortgage-backed security. See SECURITY (4).
mortgage banker. (1897) An individual or or anization that originates real-estate loans for a fee, rese ls them to other parties, and services the monthly payments.
mortgage bond. See BOND (3). mortgage broker. See BROKER.
mortgage certificate. (1843) A document evidencing part ownership of a mortgage.
mortgage clause. (1851) An insurance-policy provision that protects the rights of a mortgagee when the insured property is subject to a mortgage. 0 Such a clause usu. rovides that any insurance proceeds must be allocated Between the named insured and the mortgagee “as their
interests may appear.” -Also termed mortgagee clause. See LOSS-PAYABLE CLAUSE; ATIMA.
> open mortgage clause. (1902) A mortgage clause that does not protect the mortgagee if the insured mortgagor does something to invalidate the policy (such as committing fraud). 0 This type of clause has been largely superseded by the mortgage-loss clause, which affords
the mortgagee more protection. -Also termed simple mortgage clause. Cf. MORTGAGE-LOSS CLAUSE.
tr standard mortgage clause. (1895) A mortgage clause that protects the mortgagee’s interest even if the insured mortgagor does something to invalidate the policy. 0 In effect, this clause creates a separate contract between the insurer and the mortgagee. –Also termed union
mortgage commitment. (1939) A lender’s written agree. ment with a borrower stating the terms on which it will lend money for the purchase of specified real property, usu. with a time limitation.
mortgage company. (1873) A company that makes
mortgage loans and then sells or assigns them to inves
mortgage-contingency clause. (1965) A real-estate-sale provision that conditions the buyer’s performance on obtaining a mortgage loan.
mortgage deed. SeelDEEll.
mortgage discount. (1928) The difference between the mortgage principal and the amount the mortgage actually sells for; the up-front charge by a lender at a real-estate closing for the costs of linancing’. 0 Although usu. paid by the buyer, the discount is sometimes paid by the seller When required by law, as With a VA mortgage. -Also termed point; mortgage point; loan-brokerage fee; new-loan fee.
mortgagee (mor-ga-jee). (16c) One to whom property is mortgaged; the mortgage creditor, or lender. –Also termed mortgage-holder.
> mortgagee in possession. (18c) A mortgagee who takes control of mortgaged land by agreement with the mortgagor, usu. upon default of the loan secured by the mortgage.
mortgagee clause. See MORTGAGE CLAUSE.
mortgagee policy. (1909) A title-insurance policy that covers only the mortgagee’s title and not the owner’s title. Cf. OWNER’S POLICY. ‘
mortgage foreclosure. See FORECLOSURE.
mortgage-guarantee insurance. (1952) Insurance provided by the Mortgage Guarantee Insurance Company to mortgage lenders that grant mortgages to parties having less than a 20%‘down payment. 0 The cost of the insur«
ance is included in the closing costs. mortgage-holder. See MORTGAGEE.
mortgage insurance. See INSURANCE. mortgage lien. See LIEN.
mortgage loan. See LOAN.
mortgage-loss clause. (1924) A mortgage clause providing that title insurance will not be invalidated by the mortgagor’s acts. 0 Thus, even if the mortgagor does an act that would otherwise make the policy void, the act merely voids the policy as against the mortgagor, but it remains in full force for the benefit of the mortgagee. -Also termed New York standard clause; union-loss clause. Cf. open mortgage clause under MORTGAGE CLAUSE.
mortgage market. (1909) The conditions that provide the demand for new mortgage loans and the later resale of those loans in the secondary mortgage market.
primary mortgage market. (1965) The national market in which mortgages are originated.
‘ secondary mortgage market. (1948) The national market in which existing mortgages are bought and sold, usu. on a package basis.
mortgage note. See NOTE (1).
mortgage point. 1. See POINT (3). 2. See MORTGAGE DISCOUNT.
mortgager. See MORTGAGOR.
mortgage servicing. (1935) The administration of a mortgage loan, including the collection of payments, release of liens, and payment of property insurance and
taxes. 0 Servicing is usu. performed by the lender or the lender’s agent, for a fee. .
mortgage warehousing. (1947) An arrangement in which a mortgage company holds loans for later resale at a discount.
mortgaging out. (1952) The purchase of real property by financing 100% of the purchase price.
mortgagor (mor-ga -jor or mor-ga-jar). (16c) Someone who mortgages property; the mortgage-debtor, or borrower. -Also spelled mortgager; mortgageor. See CHARGER.
Disclaimer: All material throughout this website is compiled in accordance with Fair Use.
: Black’s Law Dictionary Deluxe Tenth Edition by Henry Campbell Black & Editor in Chief Bryan A. Garner. ISBN: 978-0-314-62130-6
: Ballantine’s Law Dictionary with Pronunciations
Third Edition by James A. Ballantine (James Arthur 1871-1949). Edited by William S. Anderson. © 1969 by THE LAWYER’S CO-OPERATIVE PUBLISHING COMPANY. Library of Congress Catalog Card No. 68-30931
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