I saw several incorrect definitions and explanations associated with a mortgage floating around in the web and hence, decided to present the very basic facts, which one should be clear of. Mentioned below are some of those :
Mortgage : A mortgage is often thought of as a "loan". A mortgage is a public notice filed in the county court house notifying anyone interested that a lien exists on a piece of real property. A mortgage is a public document, which alerts anyone searching the title of the property at the county court house that a lien exists. The mortgage is the public notice that a promissory note has been signed by the property owner. The mortgage does not create a legal obligation to pay the borrowed money. It notifies the public that a note has been signed, pledging the property as collateral on the loan. A mortgage notice prevents the property owner form selling the property without the buyer knowing a lien exists.
Lien : A lien is the legal right to keep or sell the property of a debtor as payment for a debt.
Promissory note : The obligation to pay a loan is created by signing a promissory note. The amount of loan, the amount of monthly installment and the number of payments are described in detail in the note. Other legal terms for a note or promissory note are mortgage note, a deed of trust note, a real estate loan note. The note offered by the mortgagor and presented to the mortgagee is a written agreement, which is signed by the mortgagor and held by the mortgagee.
Mortgagor : A mortgagor is the person who borrows the money.
Mortgagee : A mortgagee is the bank or lender.