When it comes to getting a mortgage, there are two main options available to borrowers: Mortgage Loan and Mortgage Credit, both of which have their own pros and cons, so it’s important to understand the difference between the two before deciding which option is right for you.
It is a lump sum of money that is used to buy a property, being returned over a certain period of time and under a fixed interest rate.
It is a type of loan that can be used for any purpose, including the purchase of a home, they can be financed for a certain term and at an interest rate that will depend on the entity that lends you the money and the amount you request.
The main difference lies in:
• Availability of Capital: With the credit, the capital is available as it is needed, while, with the loan, the client is given all the financing necessary to complete the purchase of the home.
• Cancellation of interest: With the credit, the person will pay according to the money used, with the loan, the interest will be paid for the entire debt.
• Renewal: With the credit you can request an extension once it ends, while with the loan the same facility does not exist, since it is a greater amount of money given to the client.
• Time: The credits are usually short in time and have the ease of renewal. Loans are larger agreements that take several years to pay off.
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