National Real Estate Practice Exam

What defines a mortgagor in a real estate deal?

1. Buyer

2. Seller

3. Tenant

4. Lender

The correct answer is: Buyer

In a real estate deal, a mortgagor is defined as the borrower in a mortgage agreement, which typically is the buyer of the property. This individual or entity pledges their real estate as collateral to secure a loan from a lender for the purpose of purchasing the property. The lender provides the funds, which the mortgagor agrees to repay with interest over a specified period. It's important to understand the roles of the parties involved in a mortgage transaction. The seller is the individual or entity transferring ownership of the property, while the lender is the institution or individual providing the financing. A tenant is a person who occupies the property but is not necessarily involved in the purchase or mortgage arrangement. The mortgagor's primary obligation is to repay the loan; failure to do so could lead to foreclosure and loss of the property. Therefore, in the context of the question, identifying the mortgagor as the buyer helps clarify their role in the financing and ownership of real estate.