When looking at a mortgage loan and a loan against property (LAP), it is essential to understand the differences between the two. A mortgage loan, typically known as a home loan in India, is a loan taken out to purchase a property or land. The bought property itself acts as a security until the loan is fully repaid. On the other hand, a Loan Against Property is where you mortgage your pre-owned property to get a loan. The purpose of this loan could be anything, such as financing a business, acquiring another property or even supporting education or marriage expenses. The primary difference lies in the purpose of the loan and the ownership status of the property at the time of availing the loan. In a mortgage loan, the property is being bought with the loan, whereas in a LAP, you are leveraging your existing property to get a loan for different needs.
