Mortgages usually refer to the method of taking loans on real or personal property as security for the payment of debt. These loans have to be paid over a definite period of time. Mortgages are usually associated with securing loans on real estate other than other properties. Nearly all banks and building societies offer mortgages. Apart from this, there are specialist mortgage lending companies that offer mortgages. Different types of mortgages are available. So make sure you have enough information before you go for the appropriate one. Also check the rates and fees since different lenders offer different rates and fees. Before you choose a mortgage, understand the advantages and disadvantages of different mortgages.

The key members that participate in a mortgage are the creditor and debtor. Creditor is also known as the mortgagee or lender. It is the creditor who makes loans available. Creditors are usually banks, insurers or other financial institutions. Debtor is the borrower, otherwise known as mortgagor or obligor. Debtors are those who take loans to meet their needs. Other persons who participate in mortgage are lawyer or solicitor. Solicitor or lawyer is required if there is a need for legal representation for the creditor or debtor. Mortgage brokers or financial advisers are those who help get mortgages.

There are different ways to repay your mortgage. Amortization, otherwise called repayment mortgage, is the most common way of repaying the loan. By amortization you will make monthly payments that cover the interest and principal (actual amount) over an agreed period. The amount of capital or principal you pay off increases with each payment and the percentage of interest decreases. There are ‘interest only’ mortgages. By this way, you repay only the interest over a set term. There will be a regular investment plan meant to repay the capital.

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