Legal Question in Real Estate Law in Alabama

Re: Question About A Secured Second Mortgage

Well, by definition, a "mortgage" is a security instrument. That means it is not a loan document-which is the way I think you are using it. Let me try to clarify: if you are giving someone a loan to purchase something, the agreement between you (for you to loan the money and for the borrower to agree to pay you back) is the "Note" or "loan agreement". A mortgage is a document that goes along with a note or agreement and secures real property. You should have a valid, binding loan agreement as well as a mortgage to ensure that you are properly protected. Only the mortgage needs to be filed in the probate office. However, these documents and the laws that enforces them can be rather complicated. I would strongly suggest that you speak with the closing attorney about closing both loans or, at the very least, get the proper forms and documents from an attorney. Good luck!