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What are Loans?
Loans allow individuals and businesses to borrow money from banks or other lenders to meet their financial needs. You receive the funds immediately and repay them gradually, with interest. Understanding the basics is essential for making informed financial decisions.
Loan Essentials
Here are some key components you should know about:
Principal
The principal is the original amount borrowed, excluding interest or fees. It’s the sum the borrower must repay as per the agreement.
Term
It is the duration within which the borrower must repay the loan and interest as per the agreed terms.
Rate of Interest
The Annual Percentage Rate (APR) shows how quickly your debt grows, representing the cost of borrowing or the lender's return.
Loan Repayment
This refers to the act of repaying borrowed money as per the agreement, with regular payments calculated based on the principal, duration, and interest rate.
Types of Loans
The loans are categorized into two parts: secured and unsecured loans. Both have their own eligible requirement.
Personal Loan
Unexpected expenses? Access funds effortlessly to tackle challenges, achieve your goals, and seize new opportunities.
Gold Loan
Turn your gold into an opportunity with hassle-free financing. Access quick funds while retaining ownership of your precious assets.
Car Loan
Turn your car dreams into reality. Begin your journey to owning your dream car with easy financing options.
Home Loan
Start your journey towards owning your own home. Secure your future with financing options tailored to your needs.
Education Loan
Dream big, achieve more. Don’t let finances hold you back. Fuel your education with trusted financial support.
Ready to make your Loan Decision? Reach out.
Frequently Asked Questions
Loans work by providing borrowers with funds that they repay over a specified period, often with interest. Borrowers agree to make regular payments, usually monthly, until the loan is fully repaid.
The requirements for obtaining a loan vary depending on the type of loan and the lender. Generally, lenders consider factors such as credit history, income, employment status, and debt-to-income ratio.
Secured loans require collateral, such as a house or car, to secure the loan, while unsecured loans do not require collateral but may have higher interest rates.
The amount you can borrow depends on various factors, including your creditworthiness, income, and the lender’s policies. Lenders typically have minimum and maximum loan amounts.
Missing a loan payment can result in late fees, penalties, and negative effects on your credit score. It’s essential to communicate with your lender if you anticipate difficulty making payments to explore options such as deferment or refinancing.