What type of mortgage is secured by both real and personal property, commonly used to finance new homes along with major household appliances?

• A. Adjustable-Rate Mortgage
• B. Blanket Mortgage
• C. Wraparound Mortgage
• D. Package Mortgage

Answer: (D)

A package mortgage ties the loan to both real property and personal property, such as appliances. This setup is used when you buy a new home along with major household items and want one financing package to cover both the house and the included appliances. The lender’s security covers the real estate as well as the personal property, so the loan isn’t limited to just the land.

In contrast, an adjustable-rate mortgage focuses on how the interest rate changes over time; a blanket mortgage secures multiple properties under one loan; and a wraparound mortgage creates a new loan that sits on top of an existing one. None of these pair real property with personal property in the same single security arrangement as a package mortgage.