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   Home            2. Who is the Mortgagor? What is the Mortgagee?
 
 
 
 
 
 
 
 
 
2. WHO IS THE MORTGAGOR? WHAT IS THE MORTGAGEE?
 
As noted in the previous section, the buyer/borrower pledges the property to the lender as security for the loan that the lender gave. 
 
       BUYER/Borrower 
             
  MORTGAGE
 ⇒⇒⇒⇒⇒⇒⇒⇒
 
(pledge of the property to secure the note)
 
LENDER 
  
 NOTE
                 
 
 
The suffix "or" is used to denote the person who performs an action; while the suffix "ee" is used to denote the recipient of that action.  Since the buyer/borrower is pledging the property, he/she is "mortgaging" the property and in known as the "mortgagor".  The lender is the recipient of the pledge, and therefore is the "mortgagee".
 
MORTGAGOR
BUYER/Borrower 
             
  MORTGAGE
 ⇒⇒⇒⇒⇒⇒⇒⇒
 
(pledge of the property to secure the note)
MORTGAGEE 
 
LENDER 
  
 NOTE
                 
 
One way to remember the difference between the "mortgagor" and the mortgagee:
 
The "o" in "mortgagor" comes from the "o" in "borrower".  The "e" in "mortgagee" comes from the "e" in "lender":
 
 
   MORTGAGOR                MORTGAGEE
 
           BORROWER                 LENDER               
 
 
Another way to remember the difference:               BETTER to BE the MORTGAGEE
 
Just remember: The mortgagor mortgages the property to the mortgagee.
 
 
Finally, it is worth pointing out that there was a time that the owner of property could sell property and freely transfer the mortgage to the new owner.  Due to the modernization of the credit market, lenders want to know who owes them money.  Since the new owner might not be as creditworthy as the original owner/mortgagor, lenders now insert a "due on sale" clause.  This clause requires that a mortgage be paid off when the underlying property is sold.  Nowadays, the seller sometimes finances some of the buyer's needs; and sometimes a relative or friend might give the buyer a second loan on top of the bank loan.  Otherwise, the mortgagee is always a financial institution.
 
  
 
 
 
 
  
Copyright David Hostyk Feb. 1, 2011