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What is a mortgage?

A mortgage is the instrument, represented by a legal document, that gives a lender a security interest in a property.

It is a device used to create a lien on real estate by contract.  It's purpose is to help individuals or businesses to buy residential or commercial property without paying the full value upfront.  The borrower (also called the mortgagor) uses a mortgage to pledge real property to the lender (also called the mortgagee) as security against the debt for the rest of the value of the property.

In legal terms, the creation of a mortgage gives the legal title of the land to the mortgagee and an equitable title (called "equity of redemption") to the mortgagor.  The legal title, however, only exists as a security for a debt and does not convey any title or powers associated with real property.

A mortgage isn't a home loan, but the terms have become synonymous.