mortgage

noun
mort·​gage | \ ˈmȯr-gij How to pronounce mortgage (audio) \

Definition of mortgage

 (Entry 1 of 2)

1 : a conveyance (see conveyance sense 2a) of or lien against property (as for securing a loan) that becomes void upon payment or performance according to stipulated terms took out a mortgage in order to buy the house
2a : the instrument evidencing the mortgage
b : the state of the property so mortgaged
c : the interest of the mortgagee in such property

mortgage

verb
mortgaged; mortgaging

Definition of mortgage (Entry 2 of 2)

transitive verb

1 : to grant or convey by a mortgage
2 : to subject to a claim or obligation : pledge

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Synonyms for mortgage

Synonyms: Verb

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Examples of mortgage in a Sentence

Noun He will have to take out a mortgage in order to buy the house. They hope to pay off the mortgage on their home soon. Verb She mortgaged her house in order to buy the restaurant. I've mortgaged all my free time this week to the hospice and won't be able to come to the party.
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Recent Examples on the Web: Noun Leniency on mortgages, for example, might give borrowers some extra short-term cashflow, which in turn helps them stay on top of other debts like credit cards and auto loans, Komos says. John Detrixhe, Quartz, "The US economy is caving in, but overdue debts are dropping," 20 May 2020 The package contained a number of Democratic priorities, including $100 billion for rental assistance and $75 billion in mortgage relief. Emily Cochrane, New York Times, "House Passes $3 Trillion Aid Bill Over Republican Opposition," 15 May 2020 USA TODAY Disheartening levels of jobless claims will likely drive more homeowners to seek mortgage relief in the weeks ahead. Susan Tompor, Detroit Free Press, "How to hit pause button on mortgage payments during the coronavirus crisis," 15 May 2020 The Bandcamp community showed up in a massive way, spending $4.3 million on music and merch — 15 times the amount of a normal Friday — helping artists cover rents, mortgages, groceries, medications and so much more. Mary Colurso | Mcolurso@al.com, al, "Drive-By Truckers release ‘Quarantine Together’ on Bandcamp," 1 May 2020 Rent strikes are planned at apartment buildings across the city for May, asking New York governor Andrew Cuomo to cancel rent and suspend mortgage payments for four months or until the pandemic subsides. Kate Knibbs, Wired, "The Covid-19 Rent Crisis Is Here," 1 May 2020 Banks and government relief efforts have allowed many borrowers to delay interest payments on mortgages, student debt and other loans. Stephen Gandel, CBS News, "Big banks could see $71 billion in loans sour after coronavirus shock," 15 Apr. 2020 That’s on top of the uncertainty that’s come from the federal stimulus bills, all the snags associated with the Paycheck Protection Program, and whether there will be any rent or mortgage relief for both the large chains and the small independents. Dan Reilly, Fortune, "How movie theaters can make a comeback after the coronavirus pandemic," 13 Apr. 2020 As ProPublica chronicled in story after story, the government programs to help people get mortgage relief were plagued by ongoing chaos, lax enforcement and outright failure. Jesse Eisinger, ProPublica, "How the Coronavirus Bailout Repeats 2008’s Mistakes: Huge Corporate Payoffs With Little Accountability," 7 Apr. 2020 Recent Examples on the Web: Verb In November, the Boy Scouts of America mortgaged one of its marquee properties, the 140,000-acre Philmont Scout Ranch in New Mexico, to secure $446 million in credit from J.P. Morgan Chase, according to the Associated Press. John Wisely, Detroit Free Press, "Michigan Boy Scouts say national bankruptcy won't affect local troops," 19 Feb. 2020 Republicans would take to the cable networks to rail against the wastefulness of the Democrats, who were mortgaging their kids’ future to bail out solar energy companies and bee farms. Alex Shephard, The New Republic, "A Tale of Two Stimulus Packages," 30 Mar. 2020 Every shack, trailer, ranch house and split foyer mortgaged till the end of time. Nathan Hill, New York Times, "Giving Voice to the Victims of Growth," 11 Feb. 2020 Italy and other European countries have been especially vulnerable to Chinese mercantile pressure and have mortgaged their economic futures to Beijing, with disastrous results. Victor Davis Hanson, National Review, "America Still a Global Leader Even in a Time of Crisis," 2 Apr. 2020 Stewart Day, a property developer who purchased the Shakers in 2013, mortgaged the stadium and invested £4.2m from Mederco, one of his property firms. The Economist, "Football marks the boundary between England’s winners and losers," 29 Feb. 2020 So, don’t mortgage your future with your wife; it’s time to get a new place. Author: Wayne And Wanda, Anchorage Daily News, "My wife wants to move on from our ‘starter home.’ Problem is, I love the place.," 15 Mar. 2020 The top five cities on the list were still likely to be profitable if properties were mortgaged, the company found. Michael Kolomatsky, New York Times, "Where’s the Best Place to Buy a Winter Vacation Rental?," 2 Jan. 2020 But even the luxury of a $25,000 loan obtained by mortgaging property worth $350,000 isn’t for everyone, as Pratibha Chhabra, a financial inclusion specialist at the World Bank, notes. Washington Post, "7-Cent Biscuits Are Too Pricey for Indian Workers," 26 Aug. 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'mortgage.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of mortgage

Noun

15th century, in the meaning defined at sense 1

Verb

15th century, in the meaning defined at sense 1

History and Etymology for mortgage

Noun and Verb

Middle English morgage, from Anglo-French mortgage, from mort dead (from Latin mortuus) + gage gage — more at murder

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Time Traveler for mortgage

Time Traveler

The first known use of mortgage was in the 15th century

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Statistics for mortgage

Last Updated

31 May 2020

Cite this Entry

“Mortgage.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/mortgage. Accessed 1 Jun. 2020.

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More Definitions for mortgage

mortgage

noun

Financial Definition of mortgage

What It Is

A mortgage is a loan in which property or real estate is used as collateral. The borrower enters into an agreement with the lender (usually a bank) wherein the borrower receives cash upfront then makes payments over a set time span until he pays back the lender in full.

How It Works

Mortgage loans are usually entered into by home buyers without enough cash on hand to purchase the home. They are also used to borrow cash from a bank for other projects using their house as collateral.

There are several types of mortgage loans and buyers should assess what is best for their own situation before entering into one. Types of loans are characterized by their term dates (usually from 5 to 30 years, some institutions now offer loans up to 50 year terms), interest rates (these may be fixed or variable), and the amount of payments per period.

[If you're ready to buy a home, use our Mortgage Calculator to see what your monthly principal and interest payment will be.]

Mortgages are like any other financial product in that their supply and demand will change dependent on the market. For that reason, sometimes banks can offer very low interest rates and sometimes only they can only offer high rates. If a borrower agreed upon a high interest rate and finds after a few years that rates have dropped, he can sign a new agreement at the new lower interest rate -- after jumping though some hoops, of course. This is called "refinancing."

Why It Matters

Mortgages make larger purchases possible for individuals lacking enough cash to purchase an asset, like a house, up front. Lenders take a risk making these loans as there is no guarantee the borrower will be able to pay in the future. Borrowers take risk in accepting these loans, as a failure to pay will result in a total loss of the asset.

Home ownership has become a cornerstone of the American Dream. For most people, their home is their most valuable asset. Mortgages make home buying possible for many Americans. Mortgages are not always easy to secure, however, as rates and terms are often dependent on an individual's credit score and job status. Failure to repay allows a bank to legally foreclose and auction off the property to cover its losses.

Source: Investing Answers

balloon mortgage

noun

Financial Definition of balloon mortgage

What It Is

A balloon mortgage is a mortgage with a large payment made near or at the end of a loan term.

How It Works

Unlike a loan whose total cost (interest and principal) is amortized -- that is, paid incrementally during the life of the loan -- most or all of a balloon mortgage's principal is paid in one sum at the end of the term. That sum is called the balloon payment (or sometimes the bullet). Sometimes the interest is collected as part of the balloon payment as well, though in many cases the loan is interest-only during the term of the loan with only the outstanding principal due at the end.

For example, suppose someone takes out a mortgage for $417,000. To avoid a lengthy graphic with 360 payments for a 30-year mortgage, we'll assume that the mortgage is only two years long (this is an unrealistic loan term, but it works for our purposes).

In a normal mortgage scenario (the left side of the graphic), the borrower would make a series of equal payments that are composed of principal repayment and interest payment so that by the end of the loan term, the borrower has paid down all of the loan. For a balloon mortgage (the right side of the graphic), however, the monthly payments might be extremely low for most of those two years—because at the end of the two years the borrower has to make a giant balloon payment to pay off the loan.

Why It Matters

Balloon mortgages can be common, and they have the advantage of lower initial payments. They can be preferable for people who have near-term cash flow issues but expect higher cash flows later, as the balloon payment nears. The borrower must, however, be prepared to make that balloon payment at the end of the term. Sometimes the lender will roll that amount into a new mortgage for the borrower. This is often called a two-step mortgage.

Source: Investing Answers

junior mortgage

noun

Financial Definition of junior mortgage

What It Is

A junior mortgage is a loan secured by the equity in a house. Equity equals the value of the house less the balance owed on the homeowner's first (or in some cases, preceding) mortgages.

Junior mortgages are not the same as home equity lines of credit (HELOCs).

How It Works

Junior mortgages are very similar in concept to traditional mortgages. For example, junior mortgages generally must be repaid over a fixed period. Some lenders may offer fixed rates on these loans; others might offer variable rates.

Like first mortgages, most banks will also charge points and other fees for generating the junior mortgage (attorney fees, title fees, insurance and documentation fees, for example), and these costs vary by bank. In some cases, the lender might charge a fee if the borrower prepays the loan. And because the loan is secured by a house, if the borrower defaults, the lender may foreclose on the house.

Why It Matters

Junior mortgages can be viable options when compared to credit cards or other high-interest, unsecured loans. In addition, mortgage interest is tax deductible, making the interest rates on junior mortgages sometimes lower than they appear when one considers the tax savings.

However, not all junior mortgages are created equally. Borrowers are well served to compare fees, interest rates and repayment terms among lenders. After all, when a borrower defaults, his or her home could end up belonging to the bank for good.

Source: Investing Answers

mortgage

noun
How to pronounce mortgage (audio)

English Language Learners Definition of mortgage

 (Entry 1 of 2)

: a legal agreement in which a person borrows money to buy property (such as a house) and pays back the money over a period of years

mortgage

verb

English Language Learners Definition of mortgage (Entry 2 of 2)

: to give someone a legal claim on (property that you own) in exchange for money that you will pay back over a period of years

mortgage

noun
mort·​gage | \ ˈmȯr-gij How to pronounce mortgage (audio) \

Kids Definition of mortgage

 (Entry 1 of 2)

1 : a transfer of rights to a piece of property (as a house) that is usually in return for a loan of money and that is canceled when the loan is paid
2 : the document recording such a transfer

mortgage

verb
mortgaged; mortgaging

Kids Definition of mortgage (Entry 2 of 2)

: to transfer rights to a piece of property in return for a loan of money with the understanding that the rights end when the loan is paid

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mortgage

noun
mort·​gage | \ ˈmȯr-gij How to pronounce mortgage (audio) \

Legal Definition of mortgage

 (Entry 1 of 2)

1a : a conveyance of title to property that is given to secure an obligation (as a debt) and that is defeated upon payment or performance according to stipulated terms shows that a deed was intended only as a mortgage— W. M. McGovern, Jr. et al.
b : a lien against property that is granted to secure an obligation (as a debt) and that is extinguished upon payment or performance according to stipulated terms creditors with valid mortgages against the debtor's property— J. H. Williamson
c : a loan secured by a mortgage
adjustable rate mortgage
: a mortgage having an interest rate which is usually initially lower than that of a mortgage with a fixed rate but which is adjusted periodically according to an index (as the cost of funds to the lender)
balloon mortgage
: a mortgage having the interest paid periodically and the principal paid in one lump sum at the end of the term of the loan
blanket mortgage
: a mortgage of or against all of the property of the mortgagor
chattel mortgage
: a mortgage of or against personal or movable property (as an airplane) — compare pledge security interest sense 2 at interest sense 1
collateral mortgage
in the civil law of Louisiana : a mortgage against movable or immovable property that is given to secure a written obligation (as a note) which is pledged as collateral security for a principal obligation — see also collateral note at note
construction mortgage
: a mortgage that secures a loan which finances construction
conventional mortgage
1 in the civil law of Louisiana : a mortgage that is created by a written contract
2 : a mortgage that is not guaranteed by a government agency
equitable mortgage
: a constructive or implied mortgage : a transaction (as a conveyance) that does not have the form of a mortgage but is given the effect of a mortgage by a court of equity because the parties intended it to be a mortgage
first mortgage
: a mortgage that has priority over all other security interests except those imposed by law
fixed rate mortgage
: a mortgage having an interest rate that stays the same
general mortgage
in the civil law of Louisiana : a blanket mortgage that burdens all present and future property
home equity conversion mortgage
: reverse mortgage in this entry
judicial mortgage
in the civil law of Louisiana : a mortgage lien that secures a judgment debt and is created by filing a judgment with the recorder of mortgages
junior mortgage
: second mortgage in this entry
leasehold mortgage
: a mortgage under which a leasehold interest in property secures a loan or obligation
legal mortgage
in the civil law of Louisiana : a mortgage that secures an obligation which is created by a law and which does not have to be stipulated to by the parties
open-end mortgage
: a mortgage that secures a loan agreement which allows the mortgagor to borrow additional sums usually up to a specified limit
purchase money mortgage
: a mortgage that is given (as to a lender) to secure a loan for all or some of the purchase price of property also : a mortgage given to a seller of property to secure the unpaid balance of the purchase price
reverse mortgage
: a mortgage that allows elderly homeowners to convert existing equity into available funds provided through a line of credit, a cash advance (as for the purchase of an annuity), or periodic disbursements to be repaid with interest when the home is sold or ceases to be the primary residence, when the borrower dies or some other specified event occurs, or at a fixed maturity date
second mortgage
: a mortgage lien that is subordinate in priority to a first mortgage

called also junior mortgage

senior mortgage
: first mortgage in this entry
special mortgage
: a mortgage on specified property
wrap-around mortgage \ ˈrap-​ə-​ˌrau̇nd-​ \
: a second or later mortgage that incorporates the debt of a previous mortgage with additional debt for another loan
2a : an instrument embodying and containing the provisions of a mortgage executing and recording mortgages
b : the interest of a mortgagee in mortgaged property the bank holds the mortgage
mortgaged; mortgaging

Legal Definition of mortgage (Entry 2 of 2)

1 : to grant or convey by a mortgage mortgaged the property to the bank
2 : to encumber with a mortgage

History and Etymology for mortgage

Noun

Anglo-French, from Old French, from mort dead (from Latin mortuus) + gage security

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Comments on mortgage

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