In real estate, what does the term "mortgage" generally refer to?

The term "mortgage" in real estate specifically refers to a loan that is secured by real property. This means that the borrower receives funding to purchase a property, and in return, the property itself serves as collateral for the loan. If the borrower fails to repay the loan, the lender has the legal right to take possession of the property through a process known as foreclosure.

This definition is central to real estate transactions and mortgage lending, highlighting the relationship between the borrower and the lender, and the security interest that the lender has in the property. By understanding that a mortgage involves both the concept of a loan and the collateral of real estate, one can appreciate its significance in financing property purchases.