A mortgage loan is a loan taken out against a property that you own. The property may be a house, a shop or any other commercial property. In today's times,
mortgage loan is being offered by Banks & NBFC's. The property serves as collateral and it stays in passion of the lender until the loan is repaid in full.
Interest Rates on mortgage loan
Broadly there are two types of interest rate levied on the mortgage loan - Fixed & Floating interest rate
Fixed interest rate: As the name itself suggests, a fixed interest rate remains the same for the entire loan tenure. This rate is applicable for short tenor loan option.
Floating interest rate: In this the interest rates are adjusted according to the prevailing market rates. This is a rate of interest than can change periodically and it is linked to the Marginal Cost of Funds based Lending Rate.
Mortgage Loan - Key features
The lending institutions accept fully constructed residential or commercial property for mortgage loan option.
The property should possess marketable value and be a freehold property i:e one which gives the property owner the full legal right to transfer the ownership of the property.
As the property is mortgaged with lending institution, this loan is a secured loan
Get the money you need whenever you need!
Key reasons to take out a mortgage loan are - funding higher education | meeting marriage expenses | funding medical emergencies | Business expansion | Home repairs and renovation
Benefits of mortgage loan
There are couple of benefits of taking a mortgage loan
You continue to remain the legal owner of your property while you use the funds to fulfill your requirements
Mortgage loans are easily approved since they are secured loans
The interest you pay on a mortgage loan is much lower than that of a personal loan
You get flexible repayment option with longer tenor
The loan amount availed thru mortgage loan can be utilized for varied purpose to meet out the contingencies or business expansion etc.