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.

Tuesday, December 2, 2008

U.S. construction is spending less than expected

Construction costs in the United States fell by 1.2% in October compared to the previous month, extending the black series of economic statistics this month, according to figures released Monday by the Department of Commerce.

The decline in seasonally adjusted data, is more marked than expected by analysts, who relied on a decrease of 0.9%. But it is two times less than it was in July (-2.4%).

The evolution of spending in September was revised to stable from the previous month, instead of declining 0.3% like previously announced (good news!).

On a year, construction spending in October showed a contraction of 4.6%.

Private construction costs (71% of the total) are down 2% from the previous month and 8.8% in one year.

The residential construction costs (32% of the total and 45% of private construction), which fell by 3.5% over the month and 23.6% in one year, continue to weigh on the overall trend.

Expenditures for non-residential construction (hotels, commercial or industrial buildings, offices ...) are however virtually stable over one month (-0.1%) and up 8.3% year on year.

Among the non-residential private construction, spending on commercial construction rebounded (+1.2% on a month, -11.3% on a year), and offices continue to rise (+1.1% over one month 4.4% year on year).

The expenditure of public construction (29% of the total) are near their historic record of August, up in October by 0.7% from September and 7.4% in one year.

Those of the federal state grew faster (+5.5% compared to the previous month) than those of states and local communities (0.3%).

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