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The other mortgage crisis

A couple of key terms in real estate lending are very easy to confuse.

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Some words just aren't worth the trouble, especially not on the fly. Let's not even go there – except when we have to.

Mortgagor and mortgagee are a pair of words that fall into this category. Having to deal with these two is like knowing two siblings whom you see only occasionally and not being able to remember which of them was involved in a messy divorce a while back. You wish you could keep them straight because it would make a difference in the small talk you make at the annual luncheon or wherever you see them.

If you've been paying any attention at all to the real estate crisis, you probably don't exactly smile at the word mortgage. Does it get to be any more fun if you realize that the word derives from a couple of French words meaning "dead pledge"? The idea, evidently, is that if you die, you no longer have to keep paying (although that concept is evidently under fire, if the reports of two-generation 90-year mortgages in Japan are true).

People commonly speak of "getting a mortgage" from a bank or thrift, but that's really short for "getting a mortgage loan." The property owner gives a mortgage and thus is the mortgagor. The bank or other lender is the mortgagee.

I suspect that when people get these two backward, it's because they're misapplying the model of employer/employee. The employer (large capitalist entity) employs the employee, who may be variously construed as the individual, the consumer, the "little guy," or even the oppressed laborer, who has nothing to lose but his chains. The verb employ itself has some interesting baggage – it derives from the notion of someone being "folded in" to an enterprise, even "entangled" or "implicated," with all that means.


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