A mortgage is a type of loan used to purchase real estate, typically a home. In a mortgage agreement, a lender provides the funds needed to buy the property, while the borrower agrees to repay the loan over time, usually through monthly payments. These payments typically include principal (the original loan amount), interest, taxes, and insurance.

The property itself serves as collateral, meaning if the borrower fails to repay the loan, the lender can take ownership of the home through a legal process called foreclosure. Mortgage terms commonly range from 15 to 30 years, and interest rates may be fixed (unchanging) or adjustable (changing over time).

To qualify for a mortgage, borrowers must meet certain financial criteria, such as income level, credit score, and debt-to-income ratio. Mortgages make homeownership accessible to many people who cannot afford to pay the full price of a home upfront.

A mortgage is a loan specifically designed for purchasing property, most often a home. It enables buyers to acquire real estate without paying the full price upfront. In a typical mortgage agreement, the borrower receives funds from a lender and agrees to repay the loan in monthly installments over a set period—commonly 15, 20, or 30 years.

Each payment includes a portion that reduces the principal (loan amount) and another portion that pays the interest charged by the lender. Many mortgages also include escrow payments for property taxes and homeowners insurance. The property itself secures the loan, so if the borrower defaults—fails to make payments—the lender can repossess the property through foreclosure.

There are different types of mortgages, such as fixed-rate (constant interest rate) and adjustable-rate (interest changes over time). Lenders assess factors like credit history, income, and down payment to determine mortgage approval and terms.