What is a loan & Different types of loans?
In recent times, when we consider applying for a loan, it is important to choose a legitimate money lender. Look for feedback from previous customers and the terms of the loan repayment before deciding on a money lender. There are many reasons for which people borrow money such as to buy their dream car or for a home appliance or simply for emergencies. There are money lenders which are good at personal loan in ang mo kio. Listed below are some types of loans that you can choose from.
Personal loans are the most popular loan type as they can be used for any purpose. This type of loan can be used for many purposes, for instance, to buy a new home appliance or for a trip or for shopping etc. Personal loans require minimal documentation and are simple to apply.
Education loan which is also known as student loan is quite popular now. This loan is taken when a student desires to pursue higher studies in the same or in another country. It requires quite a long process of documentation and also valid proof that shows you’ll be able to repay the loan amount.
This type of loan ensures the largest sum of money possible through a loan. It depends on the item to be mortgaged. People usually use it to mortgage homes, vehicles or offices.
A car loan is usually given out based on a fixed interest rate and a pre-decided tenure. This loan type has gained popularity nowadays due to the increasing preference for cars.
Two wheeler loan
Another vehicle loan type is for a Two-wheeler. People usually prefer the duration of 12 months to repay the loan amount. However, one may choose to repay within 3 months or 6 months on the fixed interest rate charged.
There are different instances for which people want to take a loan. Majorly, loans are categorised as secured and unsecured loans. It is important to understand the loan amount that you will be able to repay with the charged interest rate. Lenders usually look at the credit history before approving a loan. This is why it is important to maintain a good credit score of around 750 for quick approval. Always borrow the amount that is necessary for you and is easy to be repaid.