This article is about The Status Of Mortgage Loan Industry In United States. The financial industry in United States is perhaps one of the most important key players in the world economy. The status of the US financial market can easily affect the global financial system as well. This is possibly the reason why other countries carefully keep their eye on the US stocks and market trade.
One of the important aspects of United States financial market is the lending or mortgage loan business. The industry involves lending money for investors or ordinary lender and the loan payment will be secured by executing another instrument offering the borrower’s real property or personal property as collateral. The mortgage is termed as real estate mortgage if the security involves real estate property and it is called chattel mortgage if the secured property involves personal properties of the debtor or borrower.
The instrument of mortgage is distinct and separate from the original contract of loan. It is a mere subsidiary and cannot therefore be executed unless there is a breach in the original contract of loan. If the borrower failed to pay the debt, the property offered as security will be foreclosed in a public auction sale. The proceeds of the sale will be applied to the principal loan, the interest and to the cost or expenses of the foreclosure sale.
Mortgage may be either legal or equitable. Legal mortgage are those within the context of law where one has to lend money and the other will offer property as security. On the other hand, equitable mortgage define a transaction as mortgage by equity simply because it involves elements of a mortgage that is the lending of a monetary amount with offered security. Both are given recognition and legal effect.
The mortgage loan business is a big industry. There are millions of Americans out there obtaining loan annually. Several repayment ways can effectively provide profit for lenders. These payment schemes are acceptable to borrowers as they are amenable to them. They may be a payment for capital, capital or principal loan and interest, interest only or there are means that borrower need not pay for capital and interest such as the reverse mortgage. Banks as major lending institution give their trust to the borrowers because of the collateral they are offering. Either to be used as capital, be invested or for personal use, the loaned amount provide financial movement in the US fiscal market.
Just recently, the mortgage loan industry in United Sates had suffered major setbacks because of the global financial crisis. The number of delinquent borrowers had increased dramatically putting the industry on the brink of collapse. However, the resiliency and immediate action of the government carried the industry back to its place in financial market. Mortgage loans are limited after several months of the drawbacks but the succeeding years assured of promising stability and comeback.
Today, mortgage loan industry is gaining momentum because many investors and borrowers have gained back their trust and confidence to the market. It is constantly making its mark in the financial business and there is a hope and possibility of topping the chart for best financial industry in the global economy.