MORTGAGEE Meaning and
Definition
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A "mortgagee" is an essential term in the field of real estate and finance, which refers to an individual or entity that lends money to a borrower or homeowner for the purpose of acquiring property. The mortgagee is often a financial institution, such as a bank, credit union, or mortgage company.
When a person desires to purchase a property but lacks the necessary funds, they often seek a mortgage loan from a mortgagee. The mortgagee then evaluates the borrower's creditworthiness, financial history, and collateral, typically in the form of the property being purchased. If approved, the mortgagee agrees to lend the borrower a specific amount of money, known as the principal loan amount, in exchange for the borrower providing a mortgage on the property. The mortgage serves as a security interest, granting the mortgagee the legal right to seize the property if the borrower fails to repay the loan as agreed.
Throughout the loan term, the mortgagee receives regular payments from the borrower, consisting of both principal and interest. This allows the mortgagee to gradually recoup the loan amount plus interest over a predetermined period, known as the mortgage term. Once the loan is fully repaid, the mortgagee releases their claim on the property, and the borrower becomes the sole owner.
In summary, a mortgagee is the party that provides financing for the purchase of real estate, holding a mortgage as a legal claim to the property until the borrower repays the loan.
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The person to whom an estate is mortgaged.
Etymological and pronouncing dictionary of the English language. By Stormonth, James, Phelp, P. H. Published 1874.
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Etymology of MORTGAGEE
The word mortgagee has its origins in Old French. It is derived from the Old French word morgage, which was a legal term referring to a conveyance of property as security for a loan or debt. The Old French term itself had its roots in the Latin word mortuum vadium, which translates to dead pledge. This Latin term indicated that the pledge or property provided as security would be forfeited if the borrower failed to fulfill their obligations. Over time, mortgagee came to refer specifically to the party who lends money and holds the property as security in a mortgage agreement, while the borrower is known as the mortgagor.
Similar spelling words for MORTGAGEE
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