Entering into a mortgage is a huge responsibility, and for most
people, it is their biggest financial commitment. If not considered
carefully, a mortgage can have a significant impact on your
financial wellbeing.
A mortgage is a legally binding contract between a mortgagor
(the borrower) and a mortgagee (the lender), often used for the
purposes of purchasing a property. The mortgagor will have several
obligations under the agreement, the most critical of which is the
obligation to make regular payments which includes an interest
component and a principal component (so that the loan amount is
reduced).
As a borrower and in light of the current climate of increasing
interest rates, as repayment amounts increase, it is not surprising
that some borrowers may face difficulties in keeping up with their
payment obligations. If payments are not made on time as per your
mortgage terms and conditions, you will likely be in default.
