Mortgage, loan and property. What is a mortgage?

A mortgage is putting a property as a guarantee to a lender as a security for a mortgage loan.

While a mortgage in itself is not a liability or a dept, it is evidence of a debt. It is a transfer of an interest in property, from the owner to the mortgage lender, on the condition that this interest will be returned to the owner of the property when the terms of the mortgage have been satisfied or concluded.

In other words, the mortgage is a guarantee for the loan that the lender makes to the borrower. In all but a very few states, a mortgage creates a lien on the title to the mortgaged property.

Friday, May 30, 2008

Housing Index indicates Home crisis will last "an awful long time"

According to Joel Naroff, president of Naroff Economic Advisors and chief economist with Commerce Bank, the latest S&P/Case Shiller Index showing a 14 percent yearly dive in home prices is an indication that the housing downturn will run "an awful long time." The housing slump is therefore far from over.

Joel Naroff says it's an extremely large decline - the biggest he's ever seen. He predicts the home crisis will last through this year and maybe through the first half of next year.

He also says that the increase in foreclosures is putting a downward pressure on prices. He finally says that buyers are beginning to think there's still a long way to go before the real bottom is hit, so they will be holding back on making offers on homes.

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