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When it comes to purchasing your first home or making plans for your future, while still managing life currently, it can be pretty hard and stressful. From understanding investments, to thinking about loans and planning a future around you individually, or you and your family, it takes quite a lot. Looking at your income to see if you can work out a budget for the next 30 years, is a lot of work. Here we go through everything you need to know when it comes to taking out a mortgage for your dream house, dream car or just your dream So let’s start with.
A mortgage or mortgage loan is a loan for immovable property. Here the lender keeps property as collateral up until the borrower repays the total amount plus interest. Most people who buy a home, do it with a mortgage. It is of great use if you can’t pay the full amount by yourself.
There are different types of Mortgages, let’s explore some of them.
In a simple mortgage, the individual or borrower mortgages property in order to avail of a loan. In a simple mortgage, the lender has the power to sell the property if the borrower does not pay back the sum of money lent.
In this type of mortgage, there is a personal liability with the borrower. With this english mortgage the mortgaged property is shifted to the owner or lender, with this there is an agreement that it will be given with full ownership to the borrower once the full payment has been made.
Using the Usufructuary Mortgage, the property is transferred to the lender, the lender receives rent that is garnered by the property, here there is no personal liability like with the English Mortgage.
Under this type of mortgage, the borrower sells their property with the condition that the sale will become effective if they default in repayment but becomes void on successful repayment of the loaned amount of money
Under the mortgage by title deed deposit, the borrower deposits the title deed of the property in question, that is mortgaged with the lender, against the loan that it is available for.
In the reverse mortgage loan, it is usually secured for a property that enables the borrower to access the unmortgaged value of the property in question. Reverse mortgages allow homeowners to convert their home’s equity into legal tender income, without any monthly mortgage payments.
It’s important to remember that a mortgage is a type of loan but not all loans are mortgages.
Before we understand the difference between the two, let’s understand what each of them means.
This is a type of mortgage where the mortgage agreement is made between the borrower and lender only. In this, there is no third party or government agency involved. The term equitable from an equitable mortgage is taken from equity which stands for interest of justice.
Unlike the equitable mortgage, with this mortgage, it is necessary to get a stamp of approval from the sub-registrar to legalise the agreement. In this, the borrower and lender agree to a set of rules and conditions for the duration of the loan that is set by a third party.
In an equitable mortgage, the stamp duty is negligible and comes up to either 0.1% or 0.2% of the total sum, sometimes it may even be 0%. But for a registered mortgage, the stamp duty can be 5% of the total amount.
Naturally one of the biggest differences is the making of the agreement. In an equitable mortgage, the buyer needs to buy the stamp paper, with a registered mortgage, you will need to approach the sub-registrar. Plus with an equitable mortgage, it is only between the buyer and seller, no third party and with a registered mortgage there is an involvement of the third party.
If you don’t pay off your mortgage in the equitable mortgage the bank has to auction off the property in question. But when you don’t pay the amount of money in a registered mortgage the bank can do whatever it wants with it.
When we talk about Mortgages, we also need to remember Mortgage Interest rates. You may have heard of terms like adjustable mortgage rate or fixed-rate mortgage. You must be wondering what they mean, let’s find out.
With fixed rates, your interest rate remains the same till the end of your mortgage. If you’re paying 3.5% interest initially, you’ll be paying 3.5% interest till the end of your mortgage or till when you refinance the mortgage. This makes your budget easier to manage.
These interest rates change based on the market. These interest rates first stay fixed for about 5-10 years. After this period is over, your interest rate changes monthly depending on the market.
This is a lot to take in at a single glance. It’s not just about looking at your salary for the next couple of years or where you see yourself financially in the years to come. Looking for a way to finance your dream home? Just click on the link below to get the right financial help. NoBroker can help you find the right house and the right loan for it too! You can drop us a comment if you need any additional assistance.
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Last Updated: Oct 16, 2026
Education - BTech (IIT Guwahati), IIM Bangalore
With 7 years of hands-on experience structuring home loans across both public and private lending institutions, Suraj Mudaliar brings sharp, practical expertise to every borrower's journey. He specializes in loan eligibility assessment, balance transfers, and EMI optimization - helping customers not just get a loan, but get the right loan for their financial situation.
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