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Mortgages :star::red_flag: - Coggle Diagram
Mortgages :star::red_flag:
Mortgages
Purchase Money Mortgage
Borrower uses loan in order to purchase the mortgaged property
Has priority upon foreclosure even if not recorded
Future Advance Mortgage
A borrower grants in interest in their property in exchange for the right to receive future payments
Has priority when recorded even if the full amount is not given until later
Conveys Property Interest in Real Property as Security for an Obligation
Subject to Statute of Frauds
Two Parts
The Note
The Mortgage
Lien State v. Title State
Lien States
: Mortgagee cannot take possession before foreclosure
Title States
: Mortgagee entitled to possession at any time (but typically has the wait until default)
Liability Upon Transfer of Mortgage
Original Borrower
Remains liable after transfer, unless:
Lender releases them; or
Lender modifies transferee's obligation
Subsequent Transferee
Assume the Mortgage
Transferee: Primary Liability
Original Borrower: Secondary Liability
Subject to the Mortgage
Transferee Not Liable
Original Borrower Liable
Alternatives to Mortgages
Conditional Sale and Repurchase
Absolute Deed
Installment Land Contract
Deed of Trust
Equitable Mortgage