A mortgage is

A mortgage is

• A. A loan received from a friend
• B. A line of credit with variable rate
• C. A loan secured with the creditor's claim on property of the borrower
• D. A government grant for agriculture

Answer: (C)

A mortgage is a loan secured by real estate, with the property serving as collateral. The lender places a lien on the property, giving them the right to take the property through foreclosure if the borrower doesn’t repay. This security often allows for longer terms and lower interest rates compared to unsecured loans. In farming, mortgages are commonly used to purchase land or buildings, since the real estate itself guarantees the loan. The other options describe informal loans, flexible credit lines not tied to a specific property, or non-repayable government grants, which aren’t mortgages because they don’t involve the borrower’s real estate as collateral.

A mortgage is a loan secured by real estate, with the property serving as collateral. The lender places a lien on the property, giving them the right to take the property through foreclosure if the borrower doesn’t repay. This security often allows for longer terms and lower interest rates compared to unsecured loans. In farming, mortgages are commonly used to purchase land or buildings, since the real estate itself guarantees the loan. The other options describe informal loans, flexible credit lines not tied to a specific property, or non-repayable government grants, which aren’t mortgages because they don’t involve the borrower’s real estate as collateral.