A mortgage is the placing of a charge (or encumbrance in technical language) against a property as security against money borrowed. Most people use a mortgage to borrow money to allow them to purchase a property.
Until they repay the full amount of the mortgage against the property, they do not own it outright. Hence, if people fall behind on mortgage payments, due to their being a charge on the property by the mortgage lender, the property could be repossessed.
There any many different types of mortgages in terms of interest rate types, term (length) and use (residential, commercial, investment and so on). What is available to an individual through a residential mortgage application (for their main residence) will depend on their income, circumstances, amount of deposit and how they have managed their other credit accounts with other lenders such as their bank, credit card or loan providers.
In order to be able to ascertain whether to lend to an individual or not, mortgage lenders usually carry out a credit score. This is a process where an applicant looking for a mortgage provides full disclosure of their personal details including address history, employment, income and expenditure.
The lender will then cross reference this against a credit agency such as Experian or Equifax (they hold centralised records on all of us b go take a look on www.creditexpert.co.uk ). Using their own calculations the lender will then decide if they will lend, and if so how much.