What is the Difference Between Home Loan and Mortgage Loan?
Buying a home is a significant milestone, and securing the right financing is crucial. While many people use the terms home loan and mortgage loan interchangeably, they are not the same. Understanding their differences can help borrowers make informed decisions based on their financial goals. Understanding Home Loans A home loan is a secured loan specifically designed for purchasing residential property , whether new or under construction. Borrowers can use it to finance a house, apartment, or residential plot . Key Features of a Home Loan Purpose: Strictly for buying a home or property. Collateral: The purchased property serves as security. Loan Amount: Usually up to 80-85% of the property’s market value. Interest Rates: Lower compared to unsecured loans like personal loans. Repayment Tenure: Can extend up to 20-30 years. Tax Benefits: Eligible for tax deductions. How Does a Home Loan Work? Appl...