A mortgage document deals with a mortgage loan which is a loan that is taken by securing a property. The document is created to act as proof that such a loan has been taken and there are certain terms and conditions that is needed to be followed as a result. The loan can be borrowed from any financial institution. There are various considerations that are to be kept in mind when drawing a mortgage loan. The amount of the loan, interest rate, maturity period, modes of payment etc all are part of the mortgage document. Therefore, a certain amount of caution is advised while formulating this type of document. There are a few points that need to be kept in mind while creating the mortgage document, they are:
- The official names of both parties (the lender and the borrower) should be very clearly mentioned in the document. The date of the application
and approval of the loan should also be stated in the mortgage document.
- The loan amount and the duration within which all payments are required to be completed also needs to stated in the document.
- The mortgage loan will be subjected to interest rates, maturity period etc. These details also need to be included in this form of document.
- The mode of payment must be clearly mentioned. If the bank requires monthly installments of a fixed amount then it should be adhered too. Loans can also be paid off at once but they are subjected to an exorbitant fee.
- In case of failure to pay the mortgage loan, the financial institution will confiscate the property against which the loan is taken. This detail should be part of the document.
The mortgage document is a legal document and can be used for reference if there is any legal dispute.