The interest rate charged on a home mortgage is lower than the interest rate charged on a credit card because:

Question

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A home mortgage is less risky than a credit card because the home becomes collateral. This means that if the borrower defaults on the mortgage, the lender can seize the property and sell it to recoup their losses. This reduces the risk for the lender and allows them to offer a lower interest rate compared to a credit card, where there is no collateral to secure the debt. Additionally, mortgages typically involve larger loan amounts and longer repayment terms, which lowers the risk for the lender and also allows them to offer a lower interest rate.

The Interest Rate Charged on a Home Mortgage Is Lower