Mortgage Loan

A mortgage loan is a secured loan where a borrower receives funds from a lender to purchase or refinance a home or other real estate property. The borrower agrees to repay the loan amount in regular installments—typically monthly—which include both principal and interest. The property being purchased is used as collateral, meaning the lender has the legal right to seize the property if the borrower defaults on the loan.

Mortgage loans come in various types, such as fixed-rate, adjustable-rate, and interest-only loans. Loan tenure usually ranges from 10 to 30 years, and interest rates are determined by creditworthiness, market conditions, and the loan type.

Key components include:

• Principal (original loan amount)

• Interest rate

• EMI (Equated Monthly Installment)

• Loan tenure

• Down payment

• Amortization schedule

Mortgage loans are commonly offered by banks, credit unions, and housing finance companies. They are critical financial tools for individuals and families aiming to own real estate without making full upfront payments.