Mortgage Legal Meaning and Definition

Here is a simplified definition of the legal term Mortgage.

Mortgage (noun): A mortgage is a legal agreement between a person or business (the borrower) and a bank or other financial institution (the lender). In this agreement, the borrower uses their property, land, or home as security for a loan. This means that the lender has the right to take possession of the property and sell it if the borrower fails to repay the loan as agreed. The term "mortgage" comes from a French word meaning "dead pledge," because the agreement ends (or "dies") once the loan is fully paid back or if the borrower fails to pay. All mortgages must be officially recorded or registered according to law.