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What is a mortgage?

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Quick answer

A mortgage is a long-term loan you take to buy a home, using the home itself as security. You repay it in monthly EMIs over many years (often 15–30), part interest and part principal. If you stop paying, the lender can take the home.

Key things to understand

  1. A long-term loan to buy property.
  2. The home itself is the collateral.
  3. Repaid in monthly EMIs over 15–30 years.
  4. Missed payments can cost you the home.

People also ask

How is a mortgage different from a normal loan?
It's secured against the property you're buying, so rates are lower — but the lender can repossess the home if you default.
What is the down payment?
The upfront share you pay yourself (often 10–20%); the mortgage covers the rest.
Should I pick a longer or shorter tenure?
Longer tenure means smaller EMIs but much more total interest; shorter means bigger EMIs but far less interest overall.
What is a mortgage in simple terms?
A loan to buy property, repaid over years, with the property itself as security for the lender.
What's the difference between principal and interest?
Principal is the amount borrowed; interest is the extra cost the lender charges for lending it.
What happens if you can't pay your mortgage?
The lender can foreclose — take and sell the property to recover the money owed.