What is a Mortgage? A mortgage is a type of loan specifically designed for purchasing real estate. Unlike other loans, a mortgage is secured by the property itself, meaning the property acts as collateral for the loan. This security provides the lender with a level of protection, as they have the right to repossess the property if the borrower fails to meet the repayment terms. Mortgages are composed of several key components, often abbreviated as PITI: Principal, Interest, Taxes, and Insurance. The principal refers to the actual amount of money borrowed, while the interest is the cost of borrowing that… Continue Reading