What is a mortgage?

When a financial institution lends you money to buy your home, it acquires a legal interest in the property. In this case, the property is said to be ‘mortgaged’. A mortgage acts as a form of security in case you fail to make the repayments.

When you mortgage your property, you give the home loan provider the authority to lodge their interest in the property with the NSW Land and Property Management Authority. This means that you don’t have a clear title to the property and cannot sell it without their consent.

As the property owner, you are called the ‘mortgagor’ and the home loan provider is called the ‘mortgagee’.