Loans – Definition, Meaning, Types, Features

As the name suggested that the loan that means financially help to the owner. One thing remembered that we have no money at the need time so we are going for burrowing from our friends, relatives and other one person. As we want to buy something then you must have to take the money from any body. In such situation, individuals and the businesses/firms/institutions/ go for the option of the getting money from lenders in case of burrowing.

Definition of the loan :

For getting money from the lender the individual or entity with a certain guarantee or based on the trust value of the recipient. The recipient will pay all the money in the form of installment but they may have a interest that is fixed on the loan amount, this overall process is called as loan or also known as taking a loan. Therefore if you want to take the money or loan from the any bank then you must have to keep a proper knowledge of the loan terms and conditions. So this is the loan method of getting the money from the lender.

Three main components of the loan are following as :

The loan has three main type of the components such as ; Borrowed amount or the principal, Rate of interest and the tenure or the duration for which the loan is available for the loan. Such as the main things about the loan is that all these are play an important role in the their field. If you want to take the benefit of the loan then you must have to take the benefit of the loan type.

Mostly in case of loan we must allow the prefer borrowing money from the bank or the trusted non – banking financing company but they all are bound with the all the rules and regulation of the government rules. Lending is one of the primary financial of the many products of any bank or NBFC that offers you.

These are the fix amount of the loan that is fixed in the bases of the NBFC rules and conditions. As the many follow recommendation all the loan amount will be depend upon the main things about the loan. A big things about the loan is that loan is the daily need of the every customer because many person will obey the main rules and condition of the lender.

Loan is the daily need of the every person because many things are totally depend upon the daily need of just like that the car loan, home loan, gold loan etc. So if you are not able to pay the money when you must go for car loan. As we must have to obey the rule of the bank then you must have take the loan from the bank you must easily get loan from the bank and you may go for taking the car. Car loan is the loan that you can get easily available for the government employee. These are the most benefit of the car loan is that government employee would get this loan on low interest rate.

There are the few key points that you must have to remembered ;

  1. Types of loans.
  2. Based on the purpose.
  3. Based on the pledged assets.
  4. Features and benefit of the loans.
  5. Eligibility for the loan.
  6. Salaried applicants.
  7. Self – employed applicants.
  8. Loan EMI calculator.
  9. How to apply for the loan ?
  10. There are important factors lenders look at to approve your application.

Types of the Loan :

Based on the security provided there are few type of the loan are following as :

1.Secured Loans : These loans are require the main burrower to the pledge collateral for the money that being borrowed. In the case that burrower is unable to repay the loan. The bank may reserve the right to utilize the pledged collateral to the interest rate for such loan is much lower as compared to the unsecured loans. So all these are the secured loan that is beneficial for the all the owners that are very important to know about the secured loan.

2.Unsecured Loan : Unsecured loan is the loan that are those that do not require any collateral for loan disbursement so this is the loan that is unsecured by the not require the collateral. The many banks are analyses the past relationship with the help of borrower, the credit score, and the many other factors to determine whether the loan should be given or not. The interest rate for the such loans that can be higher as there is no way to recover the loan amount if the borrower defaults that is really beneficial for all the customer.

There are many loans based on the purpose use only are following as :

Personal Loan : This is loan that is applicable on the personal use only so that if you want money then you must have to go for the loan. Whenever there is a liquidity issue then you can go for the personal use. The main purpose of taking a personal loan that can be anything from the repayment of the old debt, going on the vacation, funding that for the down payment of any of the house / car and the medical emergency to purchasing the big – ticket furniture or the gadgets. Personal loan are offered based on the applicant past relationship with the lender and the credit score. So that this is the most compulsory type of loan that is really helpful for the daily need.

Vehicle loan : Vehicle loan is the loan that is applicable on the car loan or the vehicle loan. So this is the loan that is available for the purchasing on the car and the bike.

Education loan : This is a type of loan that is applicable for the all the students. For this category students do not take the worry about the study problems. For this type of loan student will have to follow the rules and conditions of the loan. So this is the most important type of loan.

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