What defines a purchase money mortgage?

A purchase money mortgage is defined as a mortgage provided by the buyer of a property to the seller to facilitate the financing of all or part of the purchase price. This type of mortgage typically helps the buyer obtain the necessary funds to complete the acquisition of the property, while simultaneously serving as a security interest for the seller. Essentially, it is a way of financing the purchase directly between the buyer and seller, rather than through a third-party lender.

This explanation highlights the specific role of the purchase money mortgage in real estate transactions, emphasizing its direct connection to the purchase of the property. Understanding this concept is crucial in property law as it addresses the interactions between buyers and sellers, as well as the security interests involved in real estate financing.