Mortgage

A mortgage is a legal agreement in which a borrower borrows money from a lender, typically a bank or financial institution, to purchase real estate. In this arrangement, the property being purchased serves as collateral for the loan. The borrower agrees to repay the loan amount, plus interest, over a specified period, usually through monthly payments. If the borrower defaults on the loan, the lender has the right to take possession of the property through a legal process known as foreclosure. Mortgages can vary in terms, including the interest rate (fixed or adjustable), repayment period, and type of loan. They are a common financial tool for individuals and businesses to finance the acquisition of property while spreading the cost over time.