Mortgage
What does it mean
A Mortgage is a document where the customer grants the bank a security interest in real estate as Collateral for a loan.
Why does it matter
A Mortgage is a common document used where a borrower gives the bank a security interest in real estate as Collateral for a loan. Upon the signing of a mortgage, a bank then must have the mortgage recorded at the county government where the real estate covered by the mortgage is located in order to perfect its lien. Lien priority is determined based on the date the mortgage is recorded. To know lien priority, banks perform title searches such as Title Opinions, Title Insurance or Owners-Encumbrances Report. Additionally mortgages have a limit on the collateral value granted to the bank, and mortgages do expire after a certain period of time (this time period varies by state).
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