Which document makes the property collateral for a mortgage loan?

The mortgage document is key in establishing the property as collateral for a mortgage loan. When a borrower takes out a mortgage, they sign a mortgage agreement, which provides a legal claim by the lender against the property in the event of default on the loan. This means that if the borrower fails to repay the mortgage as agreed, the lender has the right to foreclose on the property and sell it to recover the outstanding debt.

This process of using property as collateral is crucial for the lender's security, as it provides a tangible asset that can be seized to cover the loan if necessary. The mortgage itself outlines the specifics of how the property will be used as collateral, including the rights and responsibilities of both the borrower and lender.

In contrast, the promissory note is a document where the borrower promises to pay back the loan, but it does not establish collateral. The deed refers to the legal document that transfers ownership of the property and may not necessarily indicate the loan relationship. A lien affidavit is usually a statement that confirms the existence of a lien on the property but does not affect the collateralization arrangement as the mortgage does. Thus, the mortgage is the definitive document that makes the property collateral for the mortgage loan.