Which type of mortgage combines both real and personal property as security?

The correct answer is a package mortgage, which is specifically designed to include both real property, typically a home or land, and personal property, such as appliances, furniture, or other items. This type of mortgage allows a borrower to secure the financing needed for the purchase of both types of assets in one loan.

Package mortgages are particularly useful in transactions involving furnished or equipped properties where the lender agrees to secure the loan with both the real estate and the personal property being purchased, simplifying the financing process for the borrower.

Other types of mortgages, like an open-end mortgage, which allows the borrower to increase the amount of the loan up to a certain limit without needing to refinance, do not encompass personal property. A blanket mortgage covers multiple properties under one loan, mainly used by developers or investors, but does not combine real and personal property. A construction loan is specifically designed to finance the building of a home and typically does not include personal property as collateral.