Glossary
Mortgagee
The mortgagee is the lender that holds a mortgage over a property as security for a loan. The mortgagee has rights under the mortgage and state law, including, after a default and the required notices, the right to take possession of the property and sell it to recover the debt.
An example
When a borrower signs a mortgage in favour of a private lender, the lender becomes the mortgagee and the borrower is the mortgagor. The lender's name is recorded on the title as the holder of the mortgage.
Why it matters
Knowing who the mortgagee is matters when you need to refinance, sell or add a second loan, because the mortgagee must provide a discharge or consent. It also matters if things go wrong, as the mortgagee's enforcement rights are set out in the mortgage document.
Points to check
Before signing a mortgage, ask a lawyer to explain the mortgagee's rights on default, the notice periods under your state's law and any obligations the mortgagee has when selling. Check whether the mortgage secures only this loan or all present and future debts to the lender. If you are a guarantor or third-party mortgagor, make sure you receive separate advice.