Tuesday, December 2, 2008
What is a home loan
| A home loan (also called a mortgage) is a loan agreement that enables a person to borrow money to buy a house or other property. The property is used as security for the loan. The lender may take possession of the property if the loan cannot be repaid. A person may obtain a mortgage any financial institution that offers. A standard loan includes a Principal (unpaid loan amount) and interest over a 25 year period. Depending on the loan agreement, the home loan may come at either a variable or fix interest amount. As you pay off the loan initially a large portion of your loan repayment will go towards the interest. However as the borrower pays off the loan, more of the each monthly payment goes to the principal and less towards the interest eventually paying off the loan. Labels: Home equity loan, Home loan |
