A mortgage (from Law French , lit. "dead pledge") is a device developed in the common law world, whereby the ownership of property is passed from one person, the mortgagor, to another, the mortgagee, in return for the loan of money . The mortgagee is prevented from exercising his rights of ownership by the rules of equity so long as the interest on the loan is paid.
Historically this distinguished a mortgage from other legal devices such as a lien, charge or pledge, but in most common law jurisdictions the operations of mortgages has been changed so that these concepts have merged to a greater or lesser extent.
In modern society it is used as a method by which individuals or businesses can buy residential or commercial property without paying the full value immediately.
Source: http://en.wikipedia.org/wiki/Mortgages