Mortgage Loans - Explained in Hindi - YouTube

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Namaskar! my name is Mukul

and you are welcome to the Asset Yogi

where we unlock the financial knowledge instead of locking it.

In this video,

we are going to talk about mortgage loans.

What is the mortgage?

What are the types of mortgage loans?

We'll see its advantages and disadvantages as well

and how it compares with any unsecured loan.

So you must watch the video till the end,

Let's go straight to the blackboard.

Let's understand the concept of mortgage through an example

Assume this is a buyer and this is a seller,

and there is a deal of a house between them.

The buyer gets ready to buy this house in Rs 50 lakh

but the buyer doesn't have the entire 50 lakh in cash

let's say he has only 10 lakh rupees.

In this case, the buyer approaches a bank,

and asks to finance the remaining 40 lakh rupees.

Bank gets ready to give the loan

we call it a home loan.

Once the home loan gets sanctioned

after that, the buyer directly pays 10 lakh to the seller.

The bank never gives a loan's amount before the deal

first, the buyer will give the down payment of Rs 10 lakh

after that, the bank will give Rs 40 lakh to the seller

but the bank will say,

I'll not give you this 40 lakh rupee for free

for this, I will make you put the title of the property.

So the bank asks to put all the original property papers

as security.

Along with a loan agreement also get signed

In this loan agreement, a charge is created

So a charge is created for the bank.

If by chance the buyer defaults the loan

then the bank can recover the amount by selling this house

Right!

So this title in the form of a security

is called a mortgage.

Right!

So what is a mortgage basically?

In a way, this house is being pledged to the bank

In Hindi, we call it 'girvi rakhna'

So these original title documents are kept in the bank

as security.

So if the buyer doesn't have the original property documents

then he won't be able to sell that property,

along with bank has created a mortgage,

It means in case of loan default

the bank can recover its loan by selling the house

So this was an example of a house.

similarly, there could be different types of secured loans.

In the case of mortgage of home loans,

the property is immovable

In this case, the mortgage is created.

If you take Loan Against Property, in that case also, the mortgage is created

I had already made a video about Loan Against Property,

if you want to understand the process in detail

then you can watch that video.

Along with this, as I've written here Loan Against Property

then the home loan is also a mortgage loan,

so the home loan is also a mortgage or secured loan.

After that, bike and car loans are also secured loans

but since it is not an immovable property

so we don't call it mortgage

Here comes a term of 'Hypothecation'

but the concept is exactly the same.

Here the title is kept to the bank

similarly, in the original certificate means registration certificated or RC

the bike or car gets written in the hypothecated form,

on that, a charge or bank gets created

similarly, a gold loan is also a secured loan.

You deposit the gold in the bank as security,

after which you got the loan.

You also get a loan against security,

e.g. you have any FD in the bank, mutual fund, shares, or LIC policy,

against these also you can get a loan.

I had made a detailed video on all of these loans,

so if you haven't watch

or you want to know the process that how can you get these loans,

which documents are required?

then you can watch my videos.

So this was about secured loans.

We have an unsecured loan also

what is an unsecured loan?

for example, if you take any personal loan

then you don't have any title like this

you don't pledge a house or any asset there.

You get this loan only on the basis of your credit history.

Let me write here,

that you get this unsecured loan on the basis of your credit history.

Credit history means you have a CIBIL score,

I had made a complete video series about CIBIL score,

If you want then you can watch my videos.

So basically, in unsecured loans, there is no security.

Bank has no means,

if you default then the bank can not sell your asset

but it reports you to default in CIBIL

and your CIBIL score falls

and in future, it would be problematic to get a new loan.

Right! so what are the other examples of unsecured loans

An education loan is also an unsecured loan,

The debt of a credit card is also an unsecured loan.

Right!

So we've talked about secured and unsecured loans.

Now see how does the payment of mortgage happens?

Let's understand this also through an example.

The total price of this house was 50 lakh rupee, Right!

out of which the bank has given 40 lakh to you.

and you had 10 lakh rupee. Right!

So this was your down payment which we call equity.

what does equity mean? Ownership.

Right! I had made a video on equity and debt,

You can watch my video.

This remaining 40 lakh is called your debt.

So in this case your debt percent is 80 and equity is 20% only,

when you are taking a loan at an initial moment.

As you repay your loan equity keeps on increasing

Possibly in the one year, you pay up till 12 lakh

means you already have equity of 10 lakh

maybe you pay 2 lakh more, Right!

So in this way, your equity will gradually increase

and suppose you've taken this loan of 20 years,

then after 20 years, your equity will be 100%

which means you'll become 100% owner of this house.

So in this manner, this whole concept of mortgage works.

Now quickly I am showing you in the excel sheet

that how your EMI gets paid?

How are your principal and interest paid?

Let's see quickly.

So look here I made an EMI calculator

It's a quite detailed EMI calculator.

Let's understand one by one,

what are the inputs and results?

So you can put your inputs in this yellow space

Here you can fill your loan amount,

so I entered 40 lakh already,

here you can enter the interest rate,

if you want, you can change it

for example, if you are getting a home loan of 9%

then fill 9% here.

Here I am taking an 8.50% interest rate

currently, the home loan interest rates are about 8.50%.

Similarly, you can change loan tenure,

Here I've taken it for 20 years.

If you want can enter 30 years, 15 years or 10 years.

You can select according to your tenure.

And see this works not only for home loans,

it works for all loans

whether it is a loan against property,

car loan, bike loan, or personal loan,

you can calculate your EMI with this calculator.

So let's understand what results we get?

You see here on this green color, you get EMI

so you have to exactly this much EMI

for a loan of 40 lakh.

So you pay 34 thousand 7 hundred and 13 rupees each month.

If you are taking a loan of 40 lakh for 20 years,

so see here in this pi chart

in this blue color, you can see the principal of 40 lakh

which definitely you will have to pay in the 20 years

along with you can see you'll have to pay the interest of 43 lakh.

So after 20 years, interest becomes more than principal.

Hence you repay double the money in 20 years.

If you take 40 lakh

then you see here your total payment is coming out

as 83 lakh 33 thousand.

So let's understand the remaining chart

and how the payment gets done?

You can see here in blue color this is your principal

and in red color, this is your interest payment.

You can see in the initial years

your interest payment is very high. Right!

Let me mark here, till here this is your interest payment. Right!

So in the initial year, you are paying almost 90% as interest only,

and as you pay the principal,

your interest portion keeps on decreasing

and your principal portion increases.

So as you are paying your principal portion

your equity or ownership is increasing.

So we can say your equity is increasing

as you are paying the principal amount.

Let me show you in monthly and yearly manner,

You see this is your yearly chart or repayment schedule,

it is showing in the first year how interest you'll pay

and then what is your interest portion.

So in the first year,

you will repay the principal of almost 80 thousand

but your interest payment will become 3 lakh 36 thousand, Right!

Then this principal amount which you paid,

it will be subtracted from your total principal.

So initially your principal was 40 lakh

and if you subtract this 79 thousand from 40 lakh

then your remaining principal will be about 392000.

Right!

Similarly, in the next year let's say your principal is 86 thousand,

then you subtract this from 39 lakh 20 thousand

then you'll get your outstanding principal amount here. Right!

So see actually I prepared yearly from the monthly chart,

you pay monthly in actual

so your EMI will go every month.

So in an initial year let's say you pay 6 thousand of principal amount

and your interest payment is 28333.

Now see your interest payment is gradually decreasing every month.

You see here it was 28333 and next month it becomes 28288.

The principal payment is gradually increasing, Right!

You see in this month almost 50 rupees increased

and in this way, your principal amount is increasing

and interest payment is gradually decreasing,

as you are paying the principal.

Now see in this chart I've given one more provision,

you can choose the option of pre-payment also

for example, assume you got some money after a year,

you enter them here.

If you got 2 lakh rupees

then you can calculate

and see what will be its affect your loan.

See your EMI will be the same. Right!

But you see you see your interest portion is reduced,

we've seen before it was 43 lakh

so you will pay as early

it will have a great impact on your interest.

You've paid only 2 lakh

but you see how much profit you've got on interest?

You are getting a profit of almost 7 lakh in interest.

We can see this in the chart also,

as soon we've done principal payment after one year only,

then you see the graph is going down quickly.

You'll be able to repay your loan soon in this way.

You see the time period also got reduced.

You'll do your entire payment in the 18th year only.

Right!

So in this way your tenure is also reduced.

So in this way, you can try any other combination

in this calculator.

It is free to download if you want then you can download it.

Use it however you want.

You can use this for any loan,

In fact, I've made a detailed video on this

If you want to know how you can calculate your EMI in the formula

or you want to learn to use this calculator in detail

then you watch my video, you'll get the link in the description

and I'll provide the link to download this video in the description.

So this was about mortgage loans.

Similarly, you can use this for unsecured loans also

It's not like it will be used only in the mortgage loan,

you can use this calculator for personal or education loans also

I've tried to cover all the major points in this video

still, if any point were missing or you want to add something

then you can comment below

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