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The mortgagee’s money is protected by knowing the property is in fact security against its own tax liens. Information about the lien is registered at a county courthouse, or similar, to ensure the contract is official and binding. The lien stays in force while the debt remains but the property is actually owned by the mortgagor. This situation may seem strange but in essence what it means is that the property is owned completely by the mortgagor and not the mortgagee who also does not have the title.

The only right that your mortgage gives to the mortgagee over your property is to sell it to recover funds in the case that you do not pay off your debt. If in the unfortunate event this happens, the process whereby the funds are reclaimed is called foreclosure. To ensure that everything is legal and above board, the court will place a ruling on the disposal in a process called judicial foreclosure. This is the subject in brief and while there is a great deal more to it, perhaps this will help to clear up any ambiguities you may have previously experienced.