Difference between Home Loan and Land Loan: Which one to Choose if we are thinking of getting it through loan from banks or NBFCs (Non Banking financial companies), there is some difference between home loan and land loan. The major difference between home loan and land loan is tax benefits. There are some others similarities and differences between home loan and land loan which we will discuss in details. Home loans are offered for buying house either ready made or under construction, for construction of house on piece of land, for reimbursement of payment already made to buy home, for repairing or renovation of an existing house where as land loan are offered for buying a piece of land for purpose of investment or for purpose of constructing house there on.