A loan is when one receives finance from a bank, friend, or some finance entity with the assurance of returning it in the future along with the principal as well as the interest. Principal is the borrowed amount, and interest is the charge on receiving the loan. Considering that lenders take a risk by offering you the loan facility and the fear that you may not be in a position to repay the same
Types of Loans in India
- Personal Loan
- Student Loan
- Mortgage Loan
- Home-equity loan
- Car loans
- Two-wheeler loans
Criteria for Applying for a Loan
Various financial institutions has varying criteria for loan applications as per the type of loan availed. However, there are some standard criteria:The individual should be 18 years or older ageValid IDGive details of Bank accountProof of residence3 – 6 Months’ salary slipsProof of income
What Makes a Loan Critical?
One should understand that the loan is a liability. This means that the lender has in her/his possession, the company’s asset. A loan re-payment which is due in one year from total repayment are mostly tagged as a short-term debts on a company balance sheet. Loan re-payment that is due for more than one year is thought considered as a long-term debt. It is critically important to note that most loans come to focus when liability is considered, but most liabilities are not loans.
How To Get Education Loan?
In case of overseas education, students need additional financing as expenses are quite high. It is vital that such aspiring students know how to get education loan in India to meet these financial requirements.
How does a Mortgage Loan work?
Mortgage loans are secured in nature. A borrower must mortgage a property with the lender to avail this type of a mortgage loan. The collateral is held by the lender until full repayment of the loan is done. The loan is repaid through equated monthly instalments or EMIs.