What is a mortgage loan? Compare unsecured loans and mortgage loans

What is a mortgage loan?

A mortgage loan is a form of loan in which the borrower pledges his or her personal assets such as real estate, cars, machinery, equipment or valuable goods to the bank. This asset will be used as a means to ensure that the loan will be paid back.

The borrower will retain the right to own and use the property, however, documents proving ownership of the property will be retained by the bank until the loan is completely repaid. If the borrower cannot repay both the mortgage and the unsecured loan, The bank has the right to receive assets.

What is a mortgage?

Collateral is a legal concept that refers to the use of property owned by one party to ensure the performance of the other party's civil obligations. It is important that the assets used to secure the debt are not transferred to the lender but are only used as a means of payment to replace the debt.

Quyen is a creative copywriter with a passion for fintech. a degree from the Ho Chi Minh University of Economics. After graduating from the UEH (Ho Chi Minh Economics of University), she's constantly expanding her knowledge through investment and financial literacy courses, seminars, and conferences. Quyen also has experience in banking and credit. Her articles draw on her background in finance to help readers make informed decisions.