Which type of securities are secured by a mortgage on real property?

Mortgage securities are types of securities that are specifically secured by a mortgage on real property. These securities include instruments such as mortgage-backed securities (MBS), where the cash flows are derived from the mortgage payments made by homeowners. Essentially, the mortgage acts as collateral, providing investors with a level of security, as they have a claim on the underlying property in the event of default.

This characteristic of being secured by real property distinguishes mortgage securities from other types of bonds such as convertible bonds, callable bonds, and putable bonds, which do not inherently involve real estate collateral. Convertible bonds can be converted into a predetermined number of the issuer's shares, callable bonds can be redeemed by the issuer before maturity at specified terms, and putable bonds allow the bondholder to sell back the bond to the issuer before maturity at a specified price. None of these types of securities involves a mortgage on real property as a security backing, which is why mortgage securities are uniquely identified in this context.