| At some stage in almost everyonmes lif they ask | | | | receive a statement indicating the amount owed for |
| themselves, what kind of loan should I get? It's true that | | | | each purchase and the total one. You must pay at |
| this subject gets less attention than it deserves | | | | least a part of the bill by a due date. The interest |
| because it seems that nearly everyone's in a hurry to | | | | charged by the credit issuer has a much higher rate |
| get the money and move on to the higher priority | | | | than the ones charged in many other types of loans. |
| which is whatever they wanted the loan for in the first | | | | Personal loans |
| instance. Let's start with this. | | | | The most popular personal loans are the payday loans. |
| How much do you know about loans? This article | | | | You can borrow from $100 up to $1000 for a short |
| intends to briefly describe the most important types of | | | | period of time (regularly two weeks) and at a very |
| loans, so that you can get a global view over this issue. | | | | high interest rate (you pay something between $10 and |
| The process of lending goes like this: the borrower | | | | $20 for each $100 borrowed). If you can't pay back at |
| receives an amount of money which he pays back to | | | | the established payday date, you can pay the finance |
| the lender within a fixed period of time. The cost of the | | | | charge again and roll the loan for another two weeks. |
| service is reffered to as interest rate. Loans may be | | | | For instance, if you borrow $400 for a two-cycle |
| secured or unsecured, with periods of time ranging | | | | payday loan period (meaning a month, usually) and the |
| from a week to even more than 20 years, and with | | | | finance charge is $15 you get to pay back a total |
| annual interest rates of one up to three digit percents. | | | | amount of $520. |
| SECURED LOANS | | | | Bank overdrafts |
| Mortage | | | | You qualify for this type of loan if you have a bank |
| A mortage is a common type of loan generally used in | | | | account in good condition.When the withdrawals from |
| purchasing properties. If you want to purchase | | | | your bank account exceed the balance, the account |
| residential or commercial real estate and you cannot | | | | gets a negative balance and it means that your |
| afford to pay the full value immediately (and this | | | | provider is offering you credit. In case you have a prior |
| happens in most of the cases), you can arrange a | | | | agreement wth the provider and you have an |
| mortage. You lend money and purchase the property | | | | established overdraft limit, any withdrawals within that |
| and the financial institution is given securityby the title of | | | | limit are charged at an agreed rate. Otherwise, the |
| the house until you pay off in full. | | | | interest rate might be much higher. |
| Home equity loans | | | | Credit facilities or lines of credit |
| By using the equity in your home, you can receive a | | | | A line of credit is a flexible way to get extra funds for |
| significant amount of money that you have to repay | | | | expenses such as house repairs, vacations, or even to |
| over a fixed period at a low interest rate. If you fail to | | | | purchase an object you desire but don't have enough |
| repay, you may lose your home. However, this is a | | | | money for. In order to qualify for this type of loan you |
| popular source of finance. | | | | must have a "clean" credit history and a fixed income. |
| Car loans | | | | The total amount of money you can make use of is |
| You can take out this kind of loan if you want to | | | | established from the beginning and it depends on your |
| purchase either a new or a used car. The loan is | | | | income. |
| secured by the car itself. The loan period is shorter | | | | Corporate bonds |
| than mortgages , as it corresponds to the useful life of | | | | A bond is a loan in the form of a security. The issuer |
| the car. | | | | (the borrower) owes the lender (the bond holder) a |
| UNSECURED LOANS | | | | debt and he must repay the principal and the interest |
| Credit card debt | | | | (the coupon) within a fixed period of time. This fixed |
| The name of this type of loan comes from the small | | | | term is also called maturity and it is usually longer than |
| card issued to the user of the credit card system.You | | | | one year. The bond issue might contain other |
| can pay those who accept credit cards without | | | | stipulations too. |
| exceeding a preestablished credit limit. Basically, you | | | | When you consider getting a certain type of loan, you |
| borrow money from the issuer. With every purchase | | | | must be very cautious regarding abuses. You must |
| made, you agree to pay that amount of money plus | | | | read the contract carefully, paying attention to each |
| an established interest. | | | | detail and make sure you understand all the terms. |
| The difference between a credit card and a debit | | | | Otherwise you may find yourself in an awkward |
| card is that the former does not remove money from | | | | position relating to the loan by not being able to repay |
| your account at each transaction. Every month you | | | | it. |