A home loan is a type of financial agreement between a lender and a borrower to borrow money to purchase, build, or improve a house. The borrower uses a home loan to buy or build their own house. The borrower agrees to repay the amount borrowed plus interest over an agreed period. A mortgage is usually taken out on the property that will be bought with the money from the loan.
A home loan can also be used for renovations and improvements on an existing property. The money from this type of loan would not be paid back in one lump sum but over time as costs are incurred for work on the property.
How does a Home Loan Work?