Mortgagee versus Mortgagor

People often get confused by the difference between “mortgagor” and “mortgagee”.

It certainly is confusing because of the common language we use which is, all wrong.  When buying a home, we go to a lender “to get a mortgage” but actually, that is that is not what we are doing at all.

A mortgage is a financial claim against your property. You sign a document giving that claim to the lender, and in return they give you the money.
In effect, YOU are giving the lender something and that is, a personal promise to pay. It is YOU who mortgages the property.  The lender doesn’t GIVE a mortgage, they TAKE a mortgage.  They are taking a financial claim against your property and you are giving them a promise to pay.

So, you don’t go to a lender to “get a mortgage” but you do go to a lender to have them take a mortgage. The person who performs the action is the “or” or “er” actor. Think of “employer” or “donor”. That makes YOU, the borrower, the “mortgagor”. You’re doing the mortgaging. 

The lender on the other hand, takes your mortgage. And the recipient is always the “ee” figure. That makes the lender the “mortgagee”.
I read a tip somewhere that said you can remember the difference by noticing that “borrower” has two “o”s in it, and so does “mortgagor.” “Lender”, on the other hand, has two “e”s, and so does “mortgagee”.
So now you know.  Clear as mud?


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About Marg

is an award-winning real estate Broker who has successfully been helping people move since 1989. When it’s time for a move in or out of a bigger, smaller, better, more expensive, less expensive, newer, older, house, condo, farm, investment property, vacant lot or business, talk to Marg.

This entry was posted by Marg on Thursday, December 22nd, 2011 at 5:00 am and is filed under Money Matters. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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