What is a mortgage and how does it work?

Click stars to vote (left is low, right is high)

(2 votes, average: 3 out of 5)

 Loading ...

[?]
 Print This

A mortgage makes homeownership possible for most people. In the simplest terms, it is a loan that is secured by real property. The lender holds title to the home until the loan is completely repaid. If you fail to pay up, the lender has a right to take the property, sell it, and recover the money that is owed.

The amount of a mortgage will vary greatly depending on the down payment you make to reduce the amount of money that is needed to finance the home. You may put as much money down as you like, or you can sometimes pay as little as 3 to 5 percent of the purchase price, or sometimes nothing at all. The more you put down, the more you reduce the amount that is financed, thereby lowering your monthly payment.

The monthly payment consists of both principal and interest but also typically includes additional amounts to cover property taxes and insurance - specifically hazard insurance and private mortgage insurance, the latter of which is required for down payments less than 20 percent of the purchase price.

Homebuyers in the U.S. have access to several different types of mortgage loans.

Discussion Forum

Topic	Posts	Last Poster
Real Estate 101 - What Is A Short Sale?	3	yxvayns
My Space Page?	2	OverlandParkRealEstate
New Agent:Getting Started in RE in S. Florida - Advice?	29	DMonette
Spanish speaking agents in California?	4	CapeCodHomes
Are customers really online?	41	CapeCodHomes
Best Real Estate Blogs???.....	3	ruthrbn
A Listing and $2.00 will get you on the subway!	2	Catie10002
"I'm not going to give my house away."	13	RISORLANDO
Inexpensive Real Estate Websites	1	robertjgaffney
Is Data Integrity really That Important?	5	shelleytherealtor

Power Teams: Grasping the Agent Team Concept

Excerpt series provides insight into recently released book
RISMEDIA, May 12, 2008-Far too many real estate agents are overworked and underpaid primarily because they try to do everything themselves. They are either unaware of the agent team approach or they do not realize the benefits that such an approach can deliver both professionally and personally. In […]