One is unsecured because there’s no asset that is backing it up and the other is secured because there is an assert attached to it. Because everybody is not waking up every day requesting a home loan. When the bank get a good person who's got good credit and the also qualifying for the loan, they try to make deal and conditions inclusive of the interest rate far more flexible and more favorable for the good rated interest rate. They do not want to lose you because you may want to go to another bank. The next thing is the duration of the personal loan. Generally the maximum duration on a personal loan is seventy two months depending again on the terms and conditions that you are offered.
Some banks, especially for first time home buyers, you may find that they offer you the terms of the loan term, and you can bring it down fifteen years, but the maximum is South Africa on a loan is seventy two months, which is six years. The third thing we can look at is the maximum amount of money that you can get. If you look at the banking sector, the maximum that you can get in a personal loan is R300 000.00 of money. There are some financial institutions that might give up to R350 000.00, depending on your credit record and you credit history. But the standard one across most of the banks, is three hundred thousand rand (R300 000.00).
And if you look at a home loan, on the other hand, it is dependent on the purchase price of the properties. So again you can ask for even two hundred million rand (R2 000 0000.00) from your bank if your affordability allows for you to get to two million Rand. People can get financing on a home loan up to even seven million R7 000 000.00. It all depends on the patch' price of the house and your affordability and your risk assessment. Again, the fourth thing you need to consider when choosing whether you're using a personal loan or a home loan is the assessments that are done for you to be able to qualify for those loans on both credit lines. The qualifying assessments that are done is in affordability assessment.
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