Personal loans can be easier to get than a mortgage. The qualification process for a mortgage is generally much more thorough than that of a personal loan. Mortgage lenders will thoroughly check (and re-check) your credit report, income documentation, employment history, assets, and the property you plan to buy. With a personal loan, the approval process can take just a day or two, as opposed to more than a month for the typical mortgage.
On the other hand, mortgages are a form of secured debt. If you don’t pay your mortgage, the bank can take your house and recoup its money. Personal loans aren’t secured by the assets they buy, so personal lenders often have relatively high credit standards, and/or offer loans with higher interest rates than mortgages.
It’s also worth noting that there are both mortgages and personal loans that are designed for borrowers with credit histories ranging from poor to excellent.
Are credit cards or personal loans worse for credit?
