Taking out a mortgage is a right of passing for people as they reach a specific time in their lives. While there may be many aspects of buying a house that are exciting and refreshing, there are also particular parts of the process that are incredibly stressful. A considerable portion of what makes buying a home tedious is the seemingly endless forms you will need to fill out.
As the homebuyer, there will be several required documents you will need to fill out and a various set of documents you will need to procure. It is worth noting that understanding the difference between a mortgagor and mortgagee and the responsibilities accompanying each. This blog post will differentiate the two to help you go into your home buying experience with as much information as you can.
Mortgagor vs. Mortgagee: What Are the Differences?
Before filling out any document or doing anything related to your real estate transaction, it is crucial to fully understand your responsibilities as the buyer. Knowing exactly what is expected of you will help you navigate the waters more efficiently and get through the process with little to no complications.
What Is a Mortgagor?
In a nutshell, a mortgagor is a party who is asking for a loan. In short, the word mortgagor has the same definition as the word for “borrower.” This word is also synonymous with the word buyer. This word may apply to people looking to purchase a home or have their mortgage loan refinanced. It could also refer to a couple or group of people seeking a mortgage to finance their home.
What Is a Mortgagee?
On the other hand, it would stand to reason that the word mortgagee would refer to the lending institution providing the mortgage to the mortgagor. A mortgagee may be a loan or mortgage company, or a bank.
Mortgagees will reserve the right to hold the rights to the real estate collateral (in this case, it will be the home that the mortgagor will be asking them to finance) to protect the institution from defaulting. In other words, if a mortgagor falls short in paying the mortgage, they may be in danger of losing the house.
Why There May Be Some Confusion
If you think about it, the confusion between mortgagee and mortgagor may stem from the fact that other words in the loaning industry have similar phonetic sounds. When people hear the word “creditor,” they will automatically know that this is the person who issued the loan or to whom the money is owed. In many cases, words ending in “er” or “or” indicate that the party is doing the action. And words that end in “ee” pertain to the person receiving the action, like “interviewer” and “interviewee.” However, now that you know the difference, hopefully, you will encounter less confusion when you go about your mortgage transactions.
As the mortgagor, you will want to work with a mortgagee that will provide you with a wide range of options that will help you buy your first home and take time to explain and clear out any clarifications you may have about the sale. Working with the right mortgage brokerage will assure you of high-quality service that will serve your needs best.
If you will need home loans to help you buy your first home, come to MyLendingPal! We are a Florida and Georgia mortgage brokerage specializing in conventional, FHA, first time home buyers and VA home loans. Interested parties may call 833-379-0797.