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, March 14, 2008

Is the subprime ending?

According to, Standard & Poor's showed a ray of sunshine on a cloudy Thursday for the financial markets, indicating that price tag on the final bill for the subprime mortgage meltdown would be lower than some other prognosticators are showing.

Standard & Poor's said subprime write-downs "could reach" $285 billion and "are likely past the halfway mark." Sure that's a big number, but it's actually a lot lower than other estimates and only slightly higher than S&P's January estimate of $265 billion.

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Tuesday, March 11, 2008

Countrywide's Bad News - Another Enron

According to Countrywide Financial treads ever-closer to becoming the Enron of the housing crises.

Shares of Countrywide Financial flowed down 12.2%, or 62 cents, to $4.45, in afternoon trading Monday following news reports that the FBIis looking into whether it committed securities fraud. Specifically, the Federal Bureau of Investigation is reportedly investigating whether the company misrepresented its financial position and the quality of its mortgage loans in securities filings.

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