I need a small amount of money < 10k. What is the Difference between a mortgage and personal loan? How do i decide which one to apply for ?
2006-11-30 23:37:41 · 2 answers · asked by wil-tell 1 in Business & Finance ➔ Personal Finance
The word 'mortgage' originally came from the French and it means "death writing". In other words, you made this written agreement and you were bound by it for life. The first mortgages were written twice, side-by side on the same piece of parchment, then torn down the middle. Each party got one-half, and if there was even any doubt as to the authenticity the two halves were placed together along the torn edge and the jagged tear compared. Mortgages were used for land transactions which were called "real estate", as opposed to personal property, which was called "chattel" and came from the word meaning 'cattle' or livestock.
Today all transactions involving real estate are required to be in writing; the old practice of ripping a document down the middle long since abandoned. Mortgages involve two documents, the mortgage and note. The note is a promise to pay "promissory note" and the mortgage offers the collateral, or security, for that note.
A personal loan may or may not be backed by collateral, such as an automobile loan, and many personal loans contain fine print in them that provide for the lender to be able to repossess the property in the event of non-payment by the borrower. I noticed this once in a receipt for a fairly large-ticket item I bought from Sears; it said way down in the fine print that if I did not pay they had the right to come and take the item back. So many personal loans do contain security clauses as well. Many personal loans are secured on the signature of the borrower alone.
2006-11-30 23:51:38 · answer #1 · answered by Kokopelli 7 · 0⤊ 0⤋
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2016-09-28 08:11:33 · answer #2 · answered by Sherry 3 · 0⤊ 0⤋
A mortgage is more of a long term loan while a personal loan takes much less time to pay off. A personal loan can be used to purchase a vehicle. A mortgage is used to to purchase property.
2006-11-30 23:47:08 · answer #3 · answered by ace 3 · 1⤊ 0⤋
A mortgage is a huge amount of money that you have to repay with a reasonable interest rate and a long time to pay it off.
A personal loan is a smaller amount of money that you have to repay at a higher interest rate with a reasonable amount of time to pay it off.
If you want under $10k then personal loan is the way to go. You can't get a mortgage for such a small loan (well, the banks thinks its small!).
2006-11-30 23:40:43 · answer #4 · answered by Sarah B 2 · 0⤊ 0⤋
mortgage loan involves huge amount of money that is more than $100k n this always arranged by banks or finance co.u've to pay low interest back to bank every year according to the contract made.But personal loan is totally different from mortgage,u've to pay higher interest in a shorter time.ur 10k is a small amt,u can go 4 personal loan,but be careful to read the contract thoroughly.
good luck.
2006-12-01 00:00:44 · answer #5 · answered by robert KS LEE. 6 · 0⤊ 0⤋
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RE :Difference between a mortgage and personal loan?
I need a small amount of money < 10k. What is the Difference between a mortgage and personal loan? How do i decide which one to apply for ?
Follow 10 answers
2016-11-10 13:19:32 · answer #6 · answered by ? 6 · 0⤊ 0⤋
a mortgage is on a house only. you need a personal loan unless you want to put your house up as collateral.
2006-11-30 23:41:35 · answer #7 · answered by Sharon B 2 · 0⤊ 0⤋
It sounds like your quesiton is the difference between a secured debt and an unsecured debt, which means you either borrow money against your home and your credit ability or your credit ability alone. You will pay less interest with a secured debt.
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