A home mortgage is a loan that allows an individual to purchase a property by borrowing money from a financial institution. The property, such as a house or land, acts as collateral for the loan, which means that if the borrower fails to repay the loan, the lender can seize the property and sell it to recover their losses.
The term "mortgage" comes from the Old French word "mort gage," meaning "death pledge." This is because the borrowers were expected to pay back the loans before they died, as failure to do so would result in the loss of their property.
Home mortgages are typically offered for a set term, with fixed or variable interest rates, and require regular monthly payments that include both principal and interest. The amount of money borrowed is usually much larger than the down payment made by the buyer, which means that they will be making payments for many years to come.