Loans

Loan is an advance which is given by the banks or the financial institutions. It is a credit which is to be repaid in Specific time period decded upon by the bank. The banks charge interest on such loans, it is the source of income for them, but an expense for the customer. The interest rates vary depending upon the type of loan taken. Like if it is a secured loan, in which a security is provided which can be a property or a house, the interest rate might be lower than the unsecured loan where no such security is provided to the bank. Loans can be taken for different purposes which can be personal, like for education or home purchase or for business purpose, like for equipment purchasing etc. Depending upon the purpose, Short term or long term loans are granted by the banks. The repayment of loans must happen in monthly installments alongwith the interest amount as decided by the bank. Because of competition rising to new heights, banks are offering lower interest rates thus making it easier for the borrowers to take loans.