There are some times in life when you need funds urgently. A house mortgage loan is a loan that you take against the property you own. It could be a shop, house, or non-agricultural piece of land. The lender will provide you with the principal loan amount and the charges as interest on it.

The loan can be repaid in monthly payments. Your property will serve as collateral. 

It stays in the possession of the lender till it gets paid in full. There are two types of interest rate that applies to a mortgage loan. 

While the floating interest rate gets adjusted as per the prevailing market condition, mortgage loan rates will remain the same for the entire tenure.

What Characteristics Does A Mortgage Loan Have?

• Lenders accept properties that get constructed, your commercial shop or house.
• Not all types of properties and real estate get accepted by lenders.
• The property poses a marketable value. It should be a freehold property that gives the property owner the legal right to transfer the ownership of the property.
• Mortgage loan rates will change periodically and get directly linked to the Marginal cost of funds. 

Why Is Taking A Mortgage Loan Necessary?

A house mortgage loan Can be taken for a couple of reasons like the following.

• Funding for medical emergencies
• Paying for kids’ higher education
• Business expansion
• Paying for your son or daughter’s wedding 
• Home Renovation

 Nevertheless, there is no restriction on how you can use the money.

Also Read: Should Borrowers opt for Adjustable Mortgages Rates or Not?