What is a mortgage?

A mortgage is a type of loan used to buy or maintain a house, land, or other property. The borrower agrees to pay back the loan, plus interest, over a period of time, usually several years. During this period, the lender (usually a bank or financial entity) has an interest in the property, meaning if the borrower fails to pay the loan, the lender can take possession of the property to recover its money.

The mortgage is a common way for people to finance the purchase of a home without paying the entire price at once.