Home Loan ,Plot Loan Whether you’re a first-time homebuyer or an experienced one, a home loan is one of the most important things you need to know about before making a purchase. While many people prefer to buy an already constructed house or apartment, many others choose to buy a residential plot of land, either for investment purposes or to construct a house of their own design on it. This is when you will have to decide whether you need to apply for a home loan or a plot loan. What is the difference and what are the benefits of each? Difference between a home loan and a plot loan The basic difference between both these kinds of loans is that a home loan can only be used to buy an already constructed, or under-construction, residential property, whether it is a house or an apartment. A plot loan, also called a land loan, can only be used to buy a plot of land that has been earmarked for residential property construction.