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I'm trying to get loan from the bank and I'm going for a special interest rate category called Professional loan scheme. Since my qualification time period is low and got the degree recently they're asking me to mortgage the car. Are there any differences between car mortgage and auto loan? Is it ok to say "yes" to go for the car mortgage ?

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    Can you edit and add country tag
    – Dheer
    Aug 15, 2018 at 9:37
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    And state if it's in the US - state laws differ on auto loans as well.
    – D Stanley
    Aug 15, 2018 at 13:10
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    Really, there is no such thing as a "mortgage" on a car. Someone is using a term strangely.
    – Fattie
    Aug 16, 2018 at 11:38

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Frankly it is just weird terminology in today's jargon. While Webster defines a mortgage as:

a conveyance of or lien against property (as for securing a loan) that becomes void upon payment or performance according to stipulated terms.

Almost all traditional car loans are secured by the car being purchased, so technically they would qualify as a mortgage per Webster, however they are rarely called that. Given some of the reading I did on the matter, I would speculate that this lending institution could call it a "car mortgage" if the loan extends for a long time.

Another point of speculation is that they may call it that to make it sound more sophisticated. In other words it might be just a marketing ploy.

Can you link the institution that is providing this loan?

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    OP's profile indicates Sri Lanka as their location. I'm curious if there's a separate product there for this (I couldn't find anything via Google), or if there's a translation issue that might be at play. I'd agree with the marketing ploy theory if neither of those are the case.
    – BobbyScon
    Aug 15, 2018 at 20:35
  • My reading was that the OP already owns the car. They now want to take out a loan (for some unrelated purpose) and the bank are asking them to "mortgage" the car (i.e. put it up as collateral for the loan).
    – TripeHound
    Aug 16, 2018 at 7:14
  • Indeed, i googled "Sri Lanka Car Mortgage" and it's not a thing. Some minimum wage bank officer (or, whatever) just got terms mixed-up.
    – Fattie
    Aug 16, 2018 at 11:39
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    This could easily be a variant of what is called a title loan in the U.S. The terminology does not match U.S. terminology, but the concept certainly exists. Aug 16, 2018 at 14:43

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