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Mortgage
A loan used to finance the purchase of a home, with the property serving as collateral for the loan.
More Details
A mortgage is a loan that is used to finance the purchase of real estate, such as a home. Mortgages are typically secured by the property being purchased and are paid back over a fixed period of time, with regular payments of principal and interest.
Example
Imagine that you want to buy a new home and need to borrow money. You might apply for a mortgage from a lender, who will review your credit and financial situation to determine if you are eligible and how much they will lend you. If approved, you would receive the funds in a lump sum and make regular payments to repay the loan, including principal and interest. Mortgages can be a useful way to finance a home purchase, but it is important to consider the terms and make sure you can afford the payments.
Related Terms
APY
APY, or annual percentage yield, is the rate of dividends earned on a credit union account over a year, taking into account the effect of compounding.
Mortgage
A loan used to finance the purchase of a home, with the property serving as collateral for the loan.
APR
APR, or annual percentage rate, is a measure of the cost of borrowing money that includes the interest rate and other charges as a yearly rate.