What is a mortgage?

Learn about mortgages and the terminology that goes with them

The word mortgage is an interesting word. Its two parts are

1. mort (death), and
2. gage (pledge).

A mortgage is literally a “death pledge.” When you borrow money to buy a house you give the lender a "pledge" to "kill" the loan by paying it off.

1. Mort- is a root that means death or dead. Words with similar meanings are

• Mortal/immortal (able to/not able to die).
• Mortuary (place for the dead).
• Mortify (to humiliate to the point of death).
• Mortician (person who prepares the dead).
• Amortize means to kill off – you literally kill a loan by paying it off.

2. -Gage is a pledge. A “pledge of something valuable deposited to insure performance.” In this case, you give the title to the property you are mortgaging as collateral. The lender can use the title to seize the property if you default (don’t pay the loan back).

Does the lender give you the mortgage? Well, no.

When you get a home loan you give the mortgage to the lender; the lender doesn’t give the mortgage to you. This may seem backwards, but that is the correct way of describing what happens. If you think about the meaning of the word mortgage (death pledge), it makes sense that you are giving the “death pledge” to the lender, not taking it from the lender. So, in other words, you give the mortgage to the lender. You are in fact pledging to kill the loan by paying it off, or else the lender will kill the loan by taking over your house.