Lien vs Mortgage Companies frequently borrow funds for investment, expansion, business development and operational requirements. In order for banks and financial institutions to grant funds to borrowers, there needs to be some form of assurance that the borrowed funds will be repaid to the lender. This assurance is obtained when borrowers offer an asset […]
Difference Between Fixed and Floating Charge
Fixed vs Floating Charge Fixed and floating charges are mechanisms used to provide a lender with security over a borrower’s assets. The main difference between the two lies in the types of assets held as collateral and the flexibility in disposing the asset over the life of the loan. The type of charge chosen […]
Difference Between Collateral and Mortgage
Collateral vs Mortgage Mortgages and collateral are terms that are closely related to one another and are constantly referred to when discussing loans and lending. Collateral acts as an insurance policy for lenders which can be sold to recover losses when a borrower defaults on their loan. Mortgage is a loan that uses a […]
Difference Between Loan and Mortgage
Loan vs Mortgage Loans can be secured as well as unsecured and they can be for short as well as long durations. The word mortgage only reflects that the loan is secured and the lender has a property as collateral against the sum of money it has given to the borrower. In case of non […]
Difference Between Fannie Mae and Freddie Mac
Fannie Mae vs Freddie Mac A vast majority of home loan borrowers never come into contact with Fannie Mae and Freddie Mac. As such they remain oblivious to the existence of these two mortgage finance giants of companies. This has got to do with the fact that both these companies work with lenders rather than […]
Difference Between Fortnightly and Monthly Loan Repayments
Fortnightly vs Monthly Loan Repayments Fortnightly and Monthly Loan Repayments are the same by all means except for the frequency of the repayment schedule that results in reduced interest payment and thus reduce the loan term. When you borrow money from a bank or any other financial institution for that matter, the most common form […]
Difference Between Open Mortgage and Closed Mortgage
Open Mortgage vs Closed Mortgage Open mortgage and closed mortgage differ in the method of payment. Open mortgage is flexible, not time-bound and charged at low interest rates whereas, closed mortgage is bounded by time, high interest rates and you can pay off your mortgage only by selling the property. Open mortgage and closed mortgage […]
Difference Between APR (Annual Percentage Rate) and Interest Rate
APR (Annual Percentage Rate) vs Interest Rate If you have extra money you can invest it in a financial institution (such as banks and credit unions), building society or government bonds. These institutions reward you (investor) by paying you interest on your investments (or savings). So, your investment will earn money for you. Conversely, when […]