What is the Difference Between a Mortgage and a Promissory Note?


Is there any difference between a mortgage and promissory note? People use the terms “promissory note” and “mortgage note” to loosely refer to the same thing. But a mortgage and a promissory note are two very different things. How so? Note A promissory note is an IOU (“I owe you”) on a loan. It is a promise to repay the loan amount to the owner. Unlike mortgages or deeds of trust, promissory notes are not recorded in county land records. The lender holds the promissory note while the loan is outstanding. When the loan is fully paid off, the note will [...]