mortgage
noun
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Definition of mortgage
(Entry 1 of 2)
mortgage
verbDefinition of mortgage (Entry 2 of 2)
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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
Different groups of states sued Standard & Poor’s over faulty ratings on mortgage bonds in 2013 and foreclosure practices by banks in 2012. — Ben Brody, Fortune, "Google Is About to Go Under the Antitrust Microscope by Group of More Than 25 State Attorneys General," 3 Sep. 2019 Different groups of states sued Standard & Poor’s over faulty ratings on mortgage bonds in 2013 and foreclosure practices by banks in 2012. — Los Angeles Times, "States expected to unveil Google antitrust probe next week," 3 Sep. 2019 Edward dedicated over 25 years to commercial mortgage banking and served as President of Edward T. Byrd & Company before retirement. — orlandosentinel.com, "Deaths in Central Florida: 9/1," 1 Sep. 2019 Her husband is in commercial mortgage backed securities. — Milwaukee Journal Sentinel, "Family’s Lake Country French Provincial house gets a ‘modern vintage’ facelift," 29 Aug. 2019 Prevailing standards for mortgage approval remain rigorous. — Ellen James Martin | Andrews Mcmeel Syndication, courant.com, "Smart Moves: How to avoid overpaying for a home," 28 Aug. 2019 Falling mortgage have again boosted sales, while a decline in new home construction has left buyers with fewer options and revved up competition. — Elliot Njus, oregonlive.com, "Portland leads West Coast metros in rising home prices amid slowdown," 27 Aug. 2019 Some New York-dwelling friends came to their senses and moved back to their hometowns across the country, to be closer to their families and to have yards and comparatively normal mortgages. — Michelle Ruiz, Vogue, "#NoNewFriends Is Actually a Horrible Way to Live," 18 July 2019 Next would be any other creditor to whom Epstein owed money, such as a bank or mortgage company. — Curt Anderson, Anchorage Daily News, "Epstein may have gamed the system from beyond the grave," 22 Aug. 2019Recent Examples on the Web: Verb
Credit Ed Stefanski, the team’s senior advisor, who managed to improve the roster this summer without mortgaging the future. — Shawn Windsor, Detroit Free Press, "Pistons can't attract a Kawhi Leonard. But they do have a reason for hope," 7 July 2019 The Nets essentially mortgaged a considerable amount of their future for one trip to the conference semifinals, in 2014. — Scott Cacciola, New York Times, "Kyrie Irving Commits to Brooklyn, Cementing Nets as Kings of New York," 30 June 2019 PdVSA has mortgaged Citgo to raise financing, pledging its stock to bondholders and to Russia’s PAO Rosneft. — Andrew Scurria, WSJ, "Venezuela Strikes Deal to Save Citgo From Seizure," 25 Nov. 2018 Would-be title contenders weren't simply asked to cater to stars, but to mortgage long-term flexibility and make decisions that would be considered irresponsible in almost any other context. — Andrew Sharp, SI.com, "NBA Stars Have More Power Than Ever, But How Well Are They Using It?," 16 July 2019 Finally, most banks require that loan seekers must mortgage their house as collateral, which often proves counter-productive as interested customers view this as a disproportionate demand. — Tirthankar Mandal, Quartz India, "Cheaper loans could take solar power to more rooftops in India," 21 July 2019 This time, instead of only buying equipment, his father mortgaged the 1,200-acre family farm and bought the whole plant for $72,000. — Parija Kavilanz, CNN, "His family farm was failing. Now he runs the world's largest biofuel producer," 9 July 2019 And this was all accomplished without mortgaging their future or dealing core players. — oregonlive.com, "5 questions on Portland Trail Blazers free agency after Neil Olshey pulls off overnight roster overhaul: Commentary," 2 July 2019 The Warriors saw mortgaging part of their future as the cost of doing business to ensure the team’s greatest success following the team’s failed NBA Finals run against Toronto. — Mark Medina, The Mercury News, "Warriors mailbag: Did the Warriors make the right draft picks?," 21 June 2019These 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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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 fee