Home loans, also known as a mortgage, is the money you borrow from a bank or lender to purchase a home or investment property. When you borrow funds from a lender, you repay the amount according to a loan repayment schedule and the lender charges you interest. The money you borrow is called the loan principal.
The lender and borrower will agree on a term in which the loan is to be paid back ‒ typically, this will be a period of 25 to 30 years. The lender and borrower will also agree on a repayment schedule, which will generally be fortnightly or monthly but can vary.
A home loan is typically secured against the value of the property itself. If a borrower falls behind or cannot repay the loan, the lender may compel them to sell the property to settle the debt.