In today’s time, you can find many types of secured property loans in the market. And you may be confused about which one to select between a home loan vs mortgage loan.
If you want to know the difference and clear your difference to make a decision, here is a post to go through!
Home loan vs Mortgage loan
What is a home loan?
A home loan is a solution that lets you access a large amount to buy, build or renovate a home. You get funds up to a certain percentage of your property’s value. It could be 75-90%.
The remaining needs to be arranged by a borrower, and it is known as the down payment. The home you buy or construct is considered collateral. You also enjoy tax deductions on repayments and other modes.
The interest rates are lower with a longer home loan tenure to help you repay easily.
A home loan amount can only be used for purposes related to buying or constructing a house and nothing more.
What is a mortgage loan?
A mortgage loan is the one that is given against a property. A loan against property is the best example of a mortgage loan. The collateral, in this case, is the property you avail a loan against.
The funding is on the basis of the market value of the property and its current situation, the area it is located, and more.
The rate of interest on a mortgage loan is also lower with a longer repayment tenor.
You are free to use the mortgage loan amount for anything as per your needs without the lender’s restrictions.
You are now well versed with the home loan vs mortgage loan differences.
Based on your requirements, kind of expenses to cover and repayment budget, you should go for one. Both have a lower interest rate and a longer tenor to make you repay in smaller EMIs.
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