I was busy looking and comparing all the rates of housing loans lately as I’ve planned to get myself a house :) There are all kinds of loan out there; conventional, mortgage, Islamic and etc etc. I find myself in a dark hole when I first searching for loans cos I don’t even know what the difference is between conventional and mortgage loan. I was busy calling up banks. Some of them are very informative and helpful; some are really lame. And there’s one who only call me back after 3 weeks after my first call (it is even an international bank).
Basically mortgage is more flexible as you may choose to deposit in extra money monthly, and the bank will treat these extra money as a 2nd account that you may withdraw the money back at anytime (but please be aware that there will be no interest on these money that you deposit in). But anyway, it will still minus off your principal with those extra repayments, but once you withdraw them, they would revise the principal again. This is the only difference comparing to conventional housing loan that I managed to discover.
But of course the interest rate by applying mortgage would be slightly higher than the conventional ones as it is more flexible. You can’t actually say one is better than the other; it is very much depending on your needs. So enjoy choosing you housing loan :)
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