mortgage
noun
\
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
mortgage
verbDefinition of mortgage (Entry 2 of 2)
1 : to grant or convey by a mortgage
2 : to subject to a claim or obligation : pledge
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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.
Recent Examples on the Web: Noun
Of those units, 24,172 have rents or mortgage payments that are lower than market rate because government subsidies are attached. — David Garrick, sandiegouniontribune.com, "San Diego officials say new housing study will help them find solutions to crisis," 1 July 2018 Democrats, though, vowed to use Walters' support for the tax overhaul against her, noting that the cut backs on mortgage interest and state and local tax deductions had hit many in the affluent district. — Author: Carl Hulse, Jonathan Martin, Anchorage Daily News, "Democrats strengthen House takeover prospects in primary voting," 7 June 2018 Meanwhile, a cap on deducting state-level taxes and mortgage interest is a financial penalty (compared to the prior code), a change that especially affects people from states like California where both taxes and property values are high. — Bailey Bischoff, The Christian Science Monitor, "The tax that binds? For many, Tax Day symbolizes civic duty.," 17 Apr. 2018 Dushkin says fewer people will be itemizing their returns, though itemized deductions will consist of mortgage interest, property taxes and sales taxes. — Jacob Mcadams, Houston Chronicle, "Tax expert shares insight at Cleveland chamber lunch," 5 Mar. 2018 The Fed economists point to the housing bubble of a decade ago, which was driven by financial innovations such as securitization of mortgage debt. — Kevin Kelleher, Fortune, "Bitcoin Futures Killed the Bitcoin Rally (and Will Keep It from Returning), Economists Say," 2 July 2018 The mortgage lenders will then put a halt to any foreclosures proceedings, with multiple filings one right after the other having the potential to prolong the process even longer. — Cassie Dickman, sacbee, "Federal grand jury indicts Elk Grove woman on 18 counts related to bankruptcy scheme," 29 June 2018 Some analysts also cited higher mortgage rates, as well as volatility in the stock market that worried some potential buyers. — WSJ, "Slowdown in Home Sales Spreads to Brooklyn and Queens," 12 July 2018 Forbes calculates net worth by subtracting liabilities, including debt and mortgage, from assets: cash, investments and property. — Emma Austin, The Courier-Journal, "How much is Papa John's founder John Schnatter worth?," 12 July 2018Recent Examples on the Web: Verb
Philadelphia values the team’s assets, and the organization was averse to mortgaging its future flexibility. — Jake Fischer, SI.com, "Sources: Sixers Weighing Various Trade Packages for Kawhi Leonard," 28 June 2018 David Murphy would be on board with that, but only as long as the Phillies don’t mortgage a piece of their future. — Scott Lauber, Philly.com, "Who's on third? Phillies should choose between Mike Moustakas and Adrian Beltre | Extra Innings," 28 June 2018 So, barring a big surprise, the Patriots won’t mortgage these picks to move up for a passer. — Peter King, SI.com, "2018 NFL Draft: What Bill Belichick and the Patriots Will Do ... (We Think)," 11 Apr. 2018 To prevent delay, home buyers need to be responsive to mortgage document requests and contract timelines. — Michelle Sandlin, Houston Chronicle, "On the Move: Relocation Spotlight on BHGRE Gary Greene," 24 June 2018 In defiance of custom, ’Ntoni tries to eliminate the middlemen, mortgaging his family’s house to buy a bigger boat. — New York Times, "How Luchino Visconti Made History Sing," 7 June 2018 Coley’s parents in Sherman Oaks, Margie and Wilson Coley, emptied their retirement accounts and mortgaged their house to hire new attorneys and investigators for their only child. — Pam Kragen, sandiegouniontribune.com, "Unlikely friendship led to Carlsbad man's exoneration after 38 years in prison," 28 Apr. 2018 Family members mortgaged their homes and borrowed money from in-laws to open Brennan’s in 1956. — James R. Hagerty, WSJ, "Ella Brennan Nurtured Celebrity Chefs but Didn’t Take Them Too Seriously," 8 June 2018 The Rams, since last Monday, have amassed arguably the league’s second-best cornerback tandem out of thin air—and without mortgaging the near future. — Conor Orr, SI.com, "With Aqib Talib Trade, Rams and Broncos Show That Neither Is Content to Settle for Mediocrity," 8 Mar. 2018These 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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From the Editors at Merriam-Webster
A Glossary of Tax Terms
A Glossary of Tax Terms
Happy tax words for the happiest season
Dictionary Entries near mortgage
Statistics for mortgage
Last Updated
2 Nov 2018
Look-up Popularity
Time Traveler for mortgage
The first known use of mortgage was in the 15th century
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More Definitions for mortgage
mortgage
nounFinancial 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
nounFinancial Definition of balloon mortgage
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.
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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
nounFinancial 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
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
verbEnglish 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
See the full definition for mortgage in the English Language Learners Dictionary
mortgage
noun
\
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
verbKids 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
\
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
: 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)
: a mortgage having the interest paid periodically and the principal paid in one lump sum at the end of the term of the loan
: a mortgage of or against all of the property of the mortgagor
: a mortgage of or against personal or movable property (as an airplane) — compare pledge — security interest sense 2 at interest sense 1
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
: a mortgage that secures a loan which finances construction
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
: 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
: a mortgage that has priority over all other security interests except those imposed by law
: a mortgage having an interest rate that stays the same
in the civil law of Louisiana : a blanket mortgage that burdens all present and future property
: reverse mortgage in this entry
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
: second mortgage in this entry
: a mortgage under which a leasehold interest in property secures a loan or obligation
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
: a mortgage that secures a loan agreement which allows the mortgagor to borrow additional sums usually up to a specified limit
: 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
: 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
: a mortgage lien that is subordinate in priority to a first mortgage
— called also
junior mortgage
: first mortgage in this entry
: a mortgage on specified property
: 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
mortgage
transitive verbLegal 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
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