Home Buying

What Is a Mortgage?

A mortgage is a loan used to buy real estate, in which the property itself serves as collateral. The borrower repays the loan in regular installments over a set term, often 15 to 30 years. If the loan is not repaid as agreed, the lender can take the property through foreclosure.

What a Mortgage Payment Includes

A monthly mortgage payment typically covers principal and interest, and in many cases also property tax and homeowners insurance collected through an escrow account (often abbreviated PITI). Some loans also include mortgage insurance.

Common Types

A fixed-rate mortgage keeps the same interest rate for the whole term; an adjustable-rate mortgage (ARM) has a rate that can change after an initial period.

How Much a Mortgage Costs

The total cost depends on the loan amount, interest rate, term, and fees. An amortization schedule shows how much of each payment goes to interest and principal.

🧮 Calculate It Yourself

Put Mortgage into practice with these free calculators — no sign-up, nothing stored.

🏠 Mortgage Calculator Estimate your monthly mortgage payment including taxes, insurance, and PMI. Calculate → 🏡 Home Affordability Calculator Find the home price range you can realistically afford. Calculate → 📅 Amortization Schedule Calculator See your full year-by-year loan breakdown and what an extra payment saves. Calculate →

🔗 Related Terms

More Home Buying Terms

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Last updated: September 27, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.