What Is a Mortgage Note?
What is a mortgage note? Also known as a promissory note or deed of trust note, it’s the basic loan contract given to you by your lender—the document you signed on the dotted line to make your deal official.
A mortgage note is an important piece of paperwork to keep in your files for a variety of reasons. Here’s a rundown of what’s on this document, and why it matters.
What is a mortgage note?
Your mortgage note lays out all the specifics of your loan, including the following:
•Rate of interest•Terms of your loan (e.g., 30-year fixed or five-year ARM)
•Payment due dates
•Penalties and fees for not meeting your payment due dates or other terms of your loan
Your mortgage note is also a contract pledging your property as security for the money you’re borrowing. It gives the lender the right to repossess the property if you don’t keep your end of the bargain by making payments promptly and regularly, as spelled out in the contract.
As you can see, your mortgage note is an essential contract and an important legal document, so if you’re buying a home for the first time, make sure you put your mortgage note in a safe place where you know you’ll be able to find it.
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It would be a good idea to have a digital copy of it as well, in case your home is destroyed by flood or fire. However, if disaster strikes and you’re unprepared, know that your lender has a copy as well.