Can you answer this FAR question? If not, sit for FAR now!

Mortgage Loan

Mortgage Loan

A mortgage loan is a debt secured by a piece of real property such as land, a building, or both. Mortgage notes are written then signed by both the lender and borrower. It is a long term liability because it does not all have to be repaid in one year.

If a house and property costs $500,000, few people have $500,000 in cash to spend on the house. They might pay $100,000 in cash and borrow $400,000 in a mortgage loan. If they do not make their monthly payments the lender can come seize their property. The house and land are collateral for the loan.

There is currently no content classified with this term.

Get instant access to step-by-step instructions on how to apply and sit for the CPA Exam.