This refers to the original principal or total mortgage loan given to you by your lender. The loan amount is often not the total purchase price of the home, as your lender will most likely ask you to make a down payment on the property price of the home. A 20% deposit is desirable by most lenders. So, the loan amount will most likely represent 80% of the home purchase price. If your deposit is lower than 20%, you’ll be required to make higher monthly payments.