A mortgage is a loan from a bank or other financial institution that helps a borrower purchase a home. The collateral for the mortgage is the home itself. That means if the borrower doesn't make monthly payments to the lender and defaults on the loan, the lender can sell the home and recoup its money.
A mortgage loan is typically a long-term debt taken out for 30, 20 or 15 years. Over this time (known as the loan's "term"), you'll repay both the amount you borrowed as well as the interest charged for the loan.
You'll repay the mortgage at regular intervals, usually in the form of a monthly payment, which typically consists of both principal and interest charges.
A mortgage is a loan that people use to buy a home. To get a mortgage, you'll work with a bank or other lender. Typically, to start the process, you'll go through pre-approval to get an idea of the maximum the lender is willing to lend and the interest rate you'll pay. This helps you estimate the cost of your loan and start your search for a home.
Applying for a mortgage is a thorough process, involving many steps on your end. To start, you'll need proof of income (through paystubs and previous year's tax returns), a list of assets, debts, reasons for credit inquiries, brokerage statements (if applicable), and letters explaining any financial gifts you received for the home purchase such as help with a down payment from family members.
Once you gather your documents, you'll apply for the mortgage through the lender's website. Having all the documents ready to go can expedite the process of earning a pre-approval, since they can show their underwriters you indeed have the qualifications to pay for the mortgage.
