Mortgage deed

Mortgage deed
See also

Mortgage deed“is a legal document that gives the lender an interest in a property when you take out a loan backed by the property. Some states use documents called mortgage deeds, and some use an alternate form called a deed of trust, while still others allow both. If a borrower doesn't pay back a loan in accordance with the agreement, the lender can foreclose and take possession of the land or have it auctioned off.” [1].

In other sources we can find explanation that mortgage deed is a proof - a document - of interest transfer to the mortgage holder. This document is a legally binding agreement in which both sites agree that property becomes additional collateral. In situation when people decide to buy a home and they are forced to take a loan they need to sign a document that allows the lender to put a lien on the property until the loan will be paid in full.

Most often, a mortgage deed is arranged that officially secure the mortgage loan. The Business Dictionary indicates, that a mortgage deed is “type of mortgage in which a borrower transfers (conveys) his or her right to the ownership (title) in a property to a lender as security for a loan. Also called deed of mortgage or deed given to secure a debt.” [2].

It is the document, normally filled at a local government office, and its content varies in different states based on local law. It means that a mortgage deed is considered as legally binding document. As the example of a mortgage deed, the property selling process can be given. If a building is intended to be sold out, the future owner, or other related entity like e.g. an insurance company, should verify the status of deed on the property. The verification is crucial to be organized before the transfer of the right to a property to another person or legal unit.

Describing the formal structure of the document, it is formed in a short way, up to two pages record. The standard stakeholders are a purchaser of the property and the financial entity that releases the loan. Candace Webb ascertains such important conditions for validating the mortgage deed [3].


  • “What it does is confirm by the signature of the purchaser(s) that they are accepting the terms of the mortgage, agreeing to pay the loan back as outlined and that they agree with the mortgage company's offer to fund the loan.”
  • “Someone must witness the signing of the mortgage deed.”


  1. Steven Melendez, Monthly Mortgage Payments, (2019) „What is a Mortgage Deed?”
  2. Business Dictionary.
  3. Candace Webb, Buying and Selling, (2019) “Definition of a Mortgage Deed”


Author: Anna Droczak