Understanding Different Loan TypesLoan is a borrowed money from an individual or a financial firm for a fixed tenure of repayment. There are different types of loans that are used for various monetary needs and life goals whether it is education fees, funds for business expansion, luxury vacation, medical emergency etc.
Out of a variety of loans, personal loan has gained popularity. It is easy to apply for personal loans online via instant loan apps and trusted lending websites. It is a highest selling loan facility due to its fast processing, paperless documentation and quick disbursal in 24 hours. Being unsecured in nature, personal loans are collateral free, that means no security is required against the loan. This feature makes personal loan more accessible in less time.
Let us check what are the different loan types available that can be of use to borrowers at any stage in life:
Vehicle Loans: Fulfil your dream of owning an amazing, brand new bike or a car through easy vehicle loans. These can be applied to buy commercial vehicles or own used vehicles at a low cost.
Small Cash Loans: In a populated country like India, there are uncountable mid-size business men who have a requirement of small cash loans to set up a start-up business or support the current one. Borrowers can use small cash loans for replenishing the stock, fix urgent repairs or clear a small debt.
Secured Personal Loan: These types of personal loans demand a collateral that is a certificate, a property or an asset like a car that can be a security against the obtained loan. This loan holds a risk of losing an asset in case you are unable to make loan payments.
Home Equity Loan: A type of secured loan where your home forms the base to borrow money in bulk. The loan amount given on home equity loans depends upon the market value of your property. You can use this equity loan for major home repairs, renovations or to pay off the medical bills.
Credit Card Loan: Credit card has limited loan capacity based on the limit of the credit card. Interest is applied only on the amount spent via credit card. The instant loan amount can be requested as per the repayment capacity of the borrower.
Education Loan: Educational loan is an unsecured and collateral free loan that does not require any kind of security against the loan amount. Instant loan apps give 24/7 access whether you are travelling, in office or are home. Female students applying for education loan get discounts on the rate of interest.
Home Renovation Loan: Home renovation loan is a type of short-term personal loan that can be used for repainting the walls, changing the floor or replacing the furniture. Any pending repairs in your house can also be fixed via home renovation loan.
Travel Loan: When there is lack of savings to take a break for a refreshing holiday, opt for a travel loan that finances vacations in India or abroad. Create a clear travel budget to get an estimate of the required loan amount. Research about the trending destinations and combined holiday packages taking around multiple places in a good budget.
Wedding Loan: Manage all or some part of extravagant wedding expenses through marriage loans. When the clock is ticking and your special day is about to arrive, apply for a wedding loan in time to make the arrangements as desired.
Medical Loan: Last but not the least, a medical loan is an emergency loan that is required to support health finances involving expensive medications, therapies and surgery, if required. You can’t waste time to collect funds when medical treatment is required urgently. Hence, opt for a medical loan on priority when it is about saving a life.
Based on the increasing standard of living and high commodity prices, financial needs are rising equally. Hence, these are a variety of loans prevailing in India that support borrowers financially on time. It is advisable to check the eligibility criteria and mandatory documents list before applying for any type of a loan.