Loans are designed to help people in their tough times when they are short of money. A loan or debt is the lending money provided by one entity to another at some interest rate. There’re different types of loans designed for different persons and occasions to help people financially. Let’s have a look at different types of loans to see how they are different from each other.
As its name suggests, the student loans are designed to help students in their studies. There’re two major types; private student loans and federal student loans. Federal students are supposed to be great because they come with low interest rate and more flexible repayment terms.
If you’re thinking to buy your next dream car, this loan might help you. There’re lots of banks or car dealerships offering best auto loans at great rates. If you fail to refund, chances are you may lose your car. You should read all the terms and conditions very carefully prior to taking auto loan.
Designed to help people buy homes, mortgages are loans usually distributed by the banks. They are linked to your home, meaning you may lose your home in case you failed to repay. However, they have the lowest interest rate, and therefore we see a high demand for mortgages.
This type of loan doesn’t have any defined purpose and is used for personal expenses. It’s a quite popular option for people with outstanding arrears. If you’ve good credit history, you could easily qualify for personal loans.
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