Mortgage loan or simple a mortgage is a type of loan practiced by the purchasers of property or houses. In this type of loan, the house remains as the collectoral to the person lending the money to the borrower and the borrower borrows the money either to buy a new property and the property itself remains hanging with the lender as a collectoral or the borrower might use his own pre-purchased property to raise funds for any sort of purpose and the property that is pre-purchased is used as the collectoral by the person lending the money.
What is Mortgage Loan Modification Program
The word mortgage means “death pledge” means either the agreement is fulfilled or the property is gone from the hands of the borrower. This is the only reason that makes the people think that mortgage loan might prove to be a risky procedure often they misinterpret this type of loan as the loan that is only friendly to the lender, People think that as the property is bound by the lender, the person borrowing the sum of money from the lender becomes forced to pay it back in time else the property is likely to be possessed by the lender to recover his capital from the borrower.
mortgage loans may be associated with the people mortgaging their own property or can even be practiced for business purposes of the commercial property to make money. the lender in these types of loans is generally a bank or a credit union or a building society depending on the place involved and the people involved in the procedure of the loan. this type of loan may be practiced directly or by the involvement of the intermediary people.
suppose the borrower gets bank-rupt, and cries out that he can not pay back the money to the lender, the lender is also likely to get depressed if the loan is not mortgaged, but the procedure of mortgaging gives some relief to the lender and makes him secure as if such condition happens in real, and the borrower declares a bank-rupt, the lender can go by the agreement and possess back the entire property and sell it off to recover the money along with its interest from the borrower.
people in most of the developing and under-developed countries follow the procedure of a mortgage loan to buy their own houses. If you know you can pay back the money to the lender, then this type of loan can prove to be beneficial for both the lender and the borrower.