Whats The Difference between a Mortgage & a Note?

Whats The Difference between a Mortgage & a Note?

Whats The Difference between a Mortgage & a Note?

The terms loan, mortgage, deed of trust and note are sometimes used interchangeably by parties to a real estate transaction. Only when you get to settlement (when you see the huge stack of papers on the closing table) do you realize there is a difference. So let’s cover the note, the mortgage/deed of trust, and the differences between them.

The Note

(Signed In BLUE ink to protect against black ink “FRAUD”)

A note (or promissory note) is – very simply – a contract whereby a party makes a promise to pay a sum of money to another party under specific terms. In real estate, it is typically a borrower agreeing to make monthly payments of principal and interest over 30 years to a lender. The note has virtually nothing to do with the property itself, and can technically exist without any collateral at all. If the borrower doesn’t pay, the LENDER  can sue “under the note” and obtain remedies for breaching that contract. A “servicer” aka “debt collector” cannot if they have no equitable interest.


The Mortgage or Deed of Trust

While there are differences between a mortgage and a deed of trust, let’s ignore them for a moment, and use the term mortgage (because it’s only 1 word).

A mortgage is actually a transfer of an interest in property. While a mortgage is tied to the underlying debt created by the note, it is not a promise to pay the debt. It really isn’t a “promise” to do anything. Instead, it contains “granting” language – like a deed – which gives the lender the right to take the property if the borrower goes into default and doesn’t pay under the terms of the note signed in “BLUE” ink.

Key Differences

– A note is signed by the people who agree to pay the debt. A mortgage is signed by those who own the property being mortgaged. In a typical residential setting, signers of the note and the mortgage are the same, but they do not have to be. In a commercial context, you will often see the corporate entity which holds the property sign the mortgage, while the principals of the entity sign the note.

– A mortgage needs to be recorded in the county or town recording office, the note does not. Instead, the note goes directly to the lender.

For More Detail go HERE

Transfer Of Promissory Note

Negotiation Of Instrument=
Delivery of Instrument

Assignment Transfer Of Mortgage

Written Assignment
Delivery Of Instrument
Acceptance Of Delivery


The Lender Foreclosing must be the Owner of the NOTE along with valid Instruments.

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7 Responses to “Whats The Difference between a Mortgage & a Note?”

  1. This is where I have problems having No signatures except mine & had BofA assign my Home to Alaska Federal Credit Union o 7/20/11 or Me & Mers listed as sellers,NOT DONE BY ME! Bank of America Chapin SC had CoreLogic help out on this one. I lived & paid every month for 17 years on this home so do not call me a dead beat until you have lived in these shoes for say one month then call me what you think I am.

  2. Ramon says:

    My ex is being foreclosed. She appears on the note n I on the mortgage.
    Will my credit be affected?

  3. The Man says:

    I requested a copy of my Note from GMAC and Ocwen replied. Its a copy and the notary and any signing is barely legible. I want a wet note copuy showing blue ink. How do I request a color copy/wet copy?

  4. I asked Ocwwen for a wet copy of the Promissory Note. Let’s see in about 4-5 days. I also asked Ocwen for the name of my original lender and the rep 411 me that he could not give me the name over the phone butnwill mail to me. I also asked him for the name of mortage insurance co. He 411 me that there’s no such thing as mortage insurance co. So, I asked him for a copy of my loan file and he 411 me that yes that would be sent out. when I asked the rep what the loan file would include and he 411 me that that would include 2 documents: the copy of the promissory note and mortage note. I also asked for the name of the title co. he said that Ocwen is the name of the title co. The rep who said his name was Victor – sounded Hindu- also did not know, or did not want to give me, the name of the Remic trust, cik # for the SEC. Everything I asked him for he pretty much denied. Maybe because I am now going into foreclosure. But, I’m not going down without a fight. I need 411. Can someone help me?

  5. Facts says:

    You can have a promissory note without a mortgage. However you can not mortgage without a promissory note.

    Lenders sell the notes and 9 out 10 times CAN NOT produce the promissory note. DONT GIVE UP YOUR DEED.

  6. Grace says:

    I’m in CT. with a law date of the 28th so it most likely is to late but I keep looking so ? 1 On the quitclaim deed and the note one on the witness signed in black and was only 17 years old
    2 the notary signed as a witness and notary Com of supior court no commission express date
    3 the 1st assignment of mortgage is signed by mers as the nomimee for my leader to the trust so should the loan # the loan # that is on the loan I siged with the leader. and is there any thing I can do about now can I write to the judge! please get back to me!

  7. Many thanks to Foreclosure Fraud for this Post regarding the Note & Mortgage (TD). If a reader ever faces foreclosure from, say, Bank of America (or other Bankster), and if the reader is unlucky enough to have signed a note in favor of Americas Wholesale Lender in 2003 through 2005, you will need the information in this good Post. There is much to know. I suggest you begin by reading Carpenter v. Longan; 83 U.S. 271 (1872). The Supreme Court case will set the reader on the right path.If you are fighting foreclosure from B of A, be aware that it lost many thousands of notes in the process of Securitization and, outside of forgery, cannot provide the wet ink or “Blue Ink” copy. The bank tries to con the associated lawyers with a “Certified Copy.” The Certified Copy is probably a copy of a forgery. Look on the note for an endorsement in blank. Sometimes it’s forgotten. If it’s not there, you may be on your way to prevailing against the bankster.


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