What is a mortgage

Mortgage - a mortgage to secure its obligations to the creditor. For mortgage loans, the borrower receives a loan to purchase real estate or other goals. His commitment to the lender is the repayment of the loan, and ensure the implementation of this obligation itself secured by real estate. The buy and found you can not only housing, but also other objects of the real estate - the car, the earth, the plane, etc. Property acquired with the help of a mortgage, is the property of the borrower's credit from the moment of its acquisition. The term mortgage is usually used in connection with the decision of housing problems.
The most common use of a mortgage - it is the purchase of housing on credit. Laid at this, as a rule, once again buyers, although it is possible to build and existing property. Mortgage credits are given by banks, and credit conditions are different. At the state level by the example of Russia mortgage finds support in the form developed by the mortgage law, as well as specially created by the state mortgage Agency.
Mortgages-procedure, which occupies a lot of stages, involving the compilation of documents, search of suitable housing, assessment and insurance housing, the passage of the credit Committee of the Bank, the conclusion of the contract of mortgage. On this difficult path can help mortgage brokers. It may also require the assistance of a real estate agent when buying an apartment on credit.
When a mortgage is obtained, and houses were purchased, it is time to «maturity for a long time». Repayment of the loan can be carried out either in cash and non-cash, or in certain days or any day - these conditions are determined by the Bank. The possibility of early redemption as determined by the mortgage Bank.

A little about credits

Loan origination as a special form of the value relations occurs when the value, becoming available in some of the economic subject, for some time does not enter into a new cycle of production. Thanks to credit it goes from one subject, not using it (creditor) to another entity, who tries the need for some extra cash (the borrower).
One of the main functions of the credit: the function of redistribution; the establishment of credit instruments of treatment, reproductive and stimulating.
Thanks to the redistribution of a change occurs in the direction of movements temporarily released value. It can be carried out at the enterprise level, the industry and the state as a whole or the world economy. The redistribution is going on conditions of return of value.
Function to create a credit guns treatment is related to the emergence of the banks and the banking system as a whole. Thanks to the possibility of storage of the money funds on deposits in banks, the development of non-cash settlements, account mutual obligations, appeared credit-treatment, as well as payment.

Reproduction function loan can be considered in two ways: 1) the receipt by the borrower of the loan provides the necessary capital for entrepreneurial activity or production. By means of a loan is the reproduction of a business entity or producers as such; 2) as a result of the granting of credit different enterprises are played as best, and the worst for the company the terms of the production of goods, they are: quality, cost, price.
The stimulating function of the loan is manifested in the possibility of development of production without the presence of their own money. Thanks to a loan company get a good stimulus for further development.
Depending on the material forms with neck value can be identified commodity, monetary and mixed forms of credit.
Commodity form involves the transmission of specific things at a time. This form of historically existed before there was money relations. The equivalent for the exchange were selected products (fur, animals, food, etc.), and creditors were the subjects, who had a surplus. Return to be similar property with the specified or natural (for Pets, food, poultry) increments. In the modern conditions of the commodity form of credit is the delivery of goods with delay of payment (usually from the manufacturer to the address trade organization), the lease (rental) of the property, installment sales, commodity loan, lease of equipment, some variants of responsible storage. In some cases, the return should be the same or similar property with additional payment or without it. If the return should be the cash equivalent of the goods received by the loan, it is a mixed form of credit.
Monetary form of loan implies a transfer for temporary use to a previously specified amount of money. Monetary form is dominant in the modern economy. This form of loan is actively used by all subjects of economic relations (state, employers, enterprises) both in the country and abroad. In the monetary form of credit there is no equivalent of commodity-money exchange, and there is a transfer of value for temporary use on the condition of return within a reasonable time and, as a rule, the payment of interest for using.
A mixed form of the loan occurs in the case when the loan was granted in the form of goods, and returned the money or Vice versa - provided money, and returned goods. The latter option is often used in international settlements, when the received cash loans calculation is performed supply of goods. In the domestic economy of sale of goods by installments is accompanied by a gradual return of the loan in monetary form.
Credit plays an important role in the self-regulation of magnitude of the funds required to carry out economic activities. Thanks to the credit of the enterprises have at any time the necessary sum of cash, which will provide the normal work.
The role of the loan is important for the replenishment of the working capital Fund, the need in which each enterprise is not stable, varies depending on the operating conditions: market, natural, climatic, political, etc.
The role of loan is great for the reproduction of fixed assets. Using the credit, the enterprise can improve, increase production significantly faster than in its absence.
Important is the role of credit in the regulation of the liquidity of the banking system, as well as in the creation of an effective mechanism to Finance government spending.