Mortgage Note

A mortgage loan is a type of secured promissory note in which the mortgage has been always real property and a promissory note is based on a promise that the borrower will pay back the loan amount plus the specified interest rate within or on a specified period of time. A person who is buying property or the one who already own a property is eligible for getting mortgage loans and mortgage notes and in such loans, the amount of the loan is equal to or less than the value of the mortgage. Like other promissory notes, a mortgage note is also based on information like the names of the two parties that is the borrower and lender, the total amount of the loan, applied interest rate, date of return or due date, method of repayment and terms of the note.

A mortgage note has a number of things that both being a borrower and lender needs to be considered. A mortgage note is actually a borrower’s promise for the repayment of loan, however, the borrower should look at the defaulter terms carefully because in case of defaulter the borrower will lose the ownership of his/her property or mortgage. A mortgage is good for a lender because the lender has an option to sell out the property and to repay the loan amount.

A Sample Mortgage Note

Mortgage Note

$ _________________                                                                                        Date: ______________

State and City including ZIP Code

For the amount received, the undersigned ______________ (Borrower’s name) residence of _________________ promises to pay to the order ________________ (Lender’s name) residence of _________________________ the principal sum of $______________ together with the interest rate of the _____________% per annum until the entire loan amount is paid in ____________ equal installments starting from the ___________ (date) of the __________ (month) to the __________ (date) of ___________ (month).

This note together with the interest rate is secured by a mortgage on real estate, of even date herewith, made by the borrower hereof in favor of the lender.

Terms of the Mortgage note

Signature of the borrower                                                  Signature of the lender

Witness                                                                                      Witness

Guidelines of writing a Mortgage Note

  • On the top of the sheet, write “Mortgage Note” in bold letters.
  • At the left top of the note write the principal amount in dollars and at right top write date.
  • Write a note with the borrowers promise of repayment of the loan specifying the names of the borrower and lender, the total amount of the loan also known as principal amount, rate of interest, method of repayment that is installments or lump and the due date.
  • Terms of the loan, in which the borrower and lender has to include some effective terms regarding the repayment schedule such as a specific date and place as well as the terms of the violation and the terms of the defaulter.
  • Clearly state that the note is secured by a real estate mortgage as well as specify the current value of the mortgage.
  • End the note by taking signatures of the contracting parties as well as of the witnesses. Ensure that your mortgage note is according to the laws of the state.

Related Notes

  • Secured Promissory Note Sample This type of note is a written document that is backed by a property as a collateral or security for the loan amount. In a secured promissory note, it is stated that if the borrower is failing to repay the loan amount on the due date, the lender will then take your property. There are many lenders who never pay the loan amount without any security and is usually used in commercial or real estate loans. Secured promissory a bit stressing on the part of the borrower because if due to […]
  • Simple Promissory Note A simple promissory note is a loan document that shows an agreement between two parties and bounding the lender and the borrower legally. A simple promissory note is based on a number of details of the loan such as the amount of the loan, the names of both the parties, contact information of the parties, applied interest rate and a specific date or due date on which the borrower has to pay back the loan amount to the lender. The purpose of adding a list of information in a simple […]
  • Demand Promissory Note A demand note is a type of promissory note or loan note without any specified time for the repayment of the loan and is held by the lender that he can use it any time and call the borrower for the repayment of a loan.  These notes are provided by the lender in a flexible manner and usually based on a long term in which the lender never asks for the repayment of the loan to borrower unless he needs his money. When the demand notes are created by the loan parties, there is no kind of […]
  • Payable Note (Promissory) A payable note is a note in which a promise is made by a borrower to pay the debt on a specific date and is used as a liability on the balance sheet of the borrowing company. It is a pure accounting term and is widely used in the business sector. Payable note involves a written promissory note that is based on the loan amount, company information and date of return. A payable note is free from any kind of interest and the borrower have to pay back the principal amount to the lender. […]
  • Borrower Loan Note A loan note, as the name shows is simply a note that is written for the details of a loan. It is basically a legal document created to oblige one party to pay off the loan amount at a specified period to another party. Moreover, a loan note is actually a protection of the interest of the lender and the borrower. Loan notes are also known as promissory note and can be created for both personal and commercial loans. A loan note is based on the details related to the loan like the date […]