The most common loans
In bank loans there is a creditor and a debtor. The creditor gives the debtor a certain amount of money for a certain amount of time. The condition for the loan to be made is that when the debtor has to repay the loan. In the initial contract of the loan, it is agreed to return the money at a rate of interest.
Mortgage loans begin when the loan is made to the interested party. There must be a guarantee of by means, which is a housing in the largest of cases. It is the duty of the debtor to comply with the initial conditions of the loan. If the debt is not settled, the debtor’s house will become the property of the creditor. The loan can not be more than 80% of the value of the home; in this way it guarantees its usefulness.
Other types of loans
Student loans, student loans, are becoming increasingly popular in the United Kingdom. Banks promote their loans, boosting education and making them attractive to student families. The loan of studies tries to improve the offer of the scholarships, since in the long term and with a good volume the bank ends up gaining very significant utilities. Interest on this type of loan is relatively low compared to other types of loans.
The loans to the consumer are short-term and in smaller amount of money lent. The government can finance durable consumer products such as a television, a car or a motorcycle. All kinds of durable products in general, extra or unforeseen expenses. You can purchase services, as well as goods.
The business loan is quite opportune to start a business. The project is justified before the financial institution and the company is founded. When a company wants to expand, or start a project, it is also very profitable. When there is not enough liquidity flow and the company requires some extra expense, it is also requested. Before the current crisis and the proliferation of Small and Medium Enterprises, business loans increased their demand.
The loan and its benefits
Signing of a loan contract
There are several options for this type of loans, in turn fight the economic crisis of your country if it exists. Crowfunding is a collective financing for projects of very high magnitude. There are an infinity of projects that involve impressive capital. Sometimes a single financing is not enough for a transnational company to have enough liquidity to grow. This option, called crowdfunding, can also be used for political campaigns.
The credits now are sub-classified loans in different ways. Traditional credit, commercial credit, consumer credit and mortgage credit. On the other hand we have the consolidated credit, pledge credit, personal credit, fast credit, syndicated credit, educational credit, automotive credit, mini credit, micro credit and business credit.
For all the credits mentioned above the only thing that will vary are the parameters of all. These sub-classifications are mainly: the amount of the amount borrowed, the form and the periods in which the payments will be made. The interest rate, which depends on the need of the person who needs the loan. The more you lend me the more you charge me. All this is agreed at the time of signing the contract.
Advantages and disadvantages
The advantage of loans, for example, is that in Real Estate, most assets increase over time. It is totally profitable to request a loan for the acquisition of a home. Or even the same land, to later build a house. With the passage of time this house is increasing its value, a good business. This is an example of a profitable business.
The disadvantage of loans is the debtor’s lack of commitment towards the creditor. Today the economy is much more volatile than it was before, and people have to uncover a hole to cover another.
A loan is a money that we have to pay back, and you have to be smart when it comes to applying for it. There is no consistency in spending money that you do not really have. There has to be a considerable economic balance before even thinking about applying for a loan. There are professionals dedicated exclusively to that, to lend money to people who did not know how to take care of their economy from the beginning.
The Banks are dedicated to saving our money and charging us only a little for this task. They also dedicate themselves to lend us money that later we will not be able to pay, if we are not smart.