Mortgage

A loan arrangement between a borrower, or "mortgagor," and a lender, or "mortgagee." If you don't make your payments on a mortgage, the lender can foreclose, or take ownership of the property, only by going to court. This court action can take a great deal of time, often six months or more. Further, even after the lender has taken back the property, you may have an "equity of redemption" that allows you to redeem the property for years afterward, by paying back the mortgage and the lender's costs.

The length of time it takes to foreclose, the costs involved, and the equity of redemption make a mortgage much less desirable to lenders than a Trust Deed.

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