Write the difference between loan and mortgage.

The major differences between loan and mortgage are as follows −

Loan

• It has high interest rates.

• It can be secured/unsecured.

• It is not collaterally backed.

• The loan period is less as compared to mortgage.

• There are few formalities in case of unsecured loans when compared to mortgage.

• It requires less documentation.

• Examples − open ended loans, close ended loans, student loans, payday loans etc.

Mortgage

• It has low interest rates.

• It is always secured.

• It can be backed collaterally.

• The loan is period is more as compared to loan.

• There are strict measures for loans in mortgage.

• It requires more documentation.

• Examples − VA Loan mortgage, reverse mortgage, adjustable rate mortgage, fixed rate mortgage etc.

Mandalika

Published on 25-Jul-2020 07:14:42

• Related Questions & Answers
• What is the difference between a Secured Loan and Unsecured Loan given by Banks?
• Write the difference between debentures and bonds.
• Write the difference between leasing and financing.
• Write the difference between tax and duty.
• Write the difference between duty and tariff.
• Write the difference between shareholder and stakeholder.
• Write the difference between investment and speculations.
• Write the difference between licensing and franchising.
• Write the difference between dividend and growth.
• Write the difference between securitization and factoring.
• Write the difference between EBITDA and net income.
• Write the difference between capital expenditure and revenue expenditure?
• Write the difference between financial leverage and operating leverage.
• Write the difference between present value and future value.
• Write the difference between stock market and stock exchange.