The difference between a Home loan and Mortgage
in the financial world, a loan is the amount of money given to a borrower by any institution. The borrower can be a person, organization, business etc. The one who borrows the amount is liable to pay interest as well as the principal amount until the entire amount is paid off.
There are so many types and varieties of loan that it can be very difficult for a person to decide which one he actually wants to go for. Although it is quite clear for some cases if the objective of the loan is specified. The same can be understood by a mere example that, if a person is planning to buy a car or a home, he will surely go for a car loan or home loan respectively.
But still, there are great deals of loans which have very much importance and can prove to be very helpful for people in case of urgent needs. The two types of loans which are commonly taken by people are home loan and mortgage.
- These are the basic loans which are availed by the people to buy a home.
- The banks lend the amount to an individual at a given rate, and he has to repay it over a period of time which can maximum be 20 years along with interest as per the rate.
- Loans provided by mortgage companies such as Sun West Mortgage are utilized by the owners of existing properties to raise money for their personal use.
- Under this, the loan provided by keeping the borrower’s property as a security. It simply means that the lender has the legal rights to take ownership of the property and sell it if the borrower fails to pay back the loan.
So many sources of raising loans are available, but each one has its own merits as well as demerits from the point of view of both lender and borrower. But if you take a loan, and under any circumstances fail to pay the instalments the lender has every right to use the legal methods to get the money from you.
But it is the basic need of people which are fulfilled by means of such loans, whether it be Sun West mortgage or any other type of loan. So they have helped a lot of people in buying what they desire for, without having to go through many complications.