A mortgage loan is a loan secured by real property through the use of a mortgage note which evidences the existence of the loan and the encumbrance of that realty through the granting of a mortgage which secures the loan. However, the word mortgage alone, in everyday usage, is most often used to mean mortgage loan.
The word mortgage is a French Law
term meaning "death contract", meaning that the pledge ends (dies) when
either the obligation is fulfilled or the property is taken through foreclosure.
A home buyer or builder can obtain financing (a loan) either to
purchase or secure against the property from a financial institution,
such as a bank,
either directly or indirectly through intermediaries. Features of
mortgage loans such as the size of the loan, maturity of the loan,
interest rate, method of paying off the loan, and other characteristics
can vary considerably.
In many jurisdictions, though not all (Bali, Indonesia being one exception),
it is normal for home purchases to be funded by a mortgage loan. Few
individuals have enough savings or liquid funds to enable them to
purchase property outright. In countries where the demand for home ownership is highest, strong domestic markets have developed.