Mortgage Contract Law Explained

Summary

Mortgages are governed by contract law, requiring an exchange of value, known as consideration. This typically involves the borrower receiving funds to purchase property and the lender receiving a promise of repayment with interest. Funds are usually provided by financial institutions like banks, based on their capital and the borrowers creditworthiness.

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does something of value need to be exchanged
In contract law, yes, something of value—known as "consideration"—must be exchanged between the parties. In the context of a mortgage, the consideration typically involves the borrower receiving funds to purchase property and the lender receiving the borrower's promise to repay the loan, usually with interest.
Is there a specific issue with your mortgage that you're concerned about?
how are the funds created
The funds in a mortgage are typically created through a financial institution such as a bank or a building society. These institutions provide the loan amount based on their available capital and the borrower's creditworthiness.
Is there a specific aspect of your mortgage or the funding process you're concerned about?