Before taking out a loan look at the different options available

04 April 2013 - Mark Maffia

Before taking out a loan look at the different options available

A huge variety of loans is available which doesn't always make it easy to decide which one is the most suitable. A secured loan is probably the most popular loan because it allows you to borrow a large amount of money over a period of time. Usually the loan is secured against property, but also gold and other assets can be used.

What kind of loans can I take out?

Different loans are available depending on what you need the money for. Some loans specialize in the financing of cars or motorbikes; they usually are much cheaper than the financing through the car dealer. If you start off a new business you can apply for a business loan, and if you plan the purchase of a new home there are special loans available. Anybody who plans a wedding for oneself or one's children can apply for a wedding loan, personal loans can be taken out for any purchase, and you are free to use the borrowed sum for whatever you like.
Every loan has to be paid back within an agreed upon time, and interest rate apply. The interest rates depend on the amount of the loan, on how long you need the money for and on the creditworthiness of the borrower. If somebody has a poor credit history, it means a higher risk for the lender. This is why he will charge a higher interest rate.

How much can one borrow?

How much one can borrow depends on one's financial situation. The income has to be secure and the credit rating should be in order. Some lenders offer a maximum borrowing sum.

Who can take out a loan?

Usually you have to be 21 years old and often not older than 65. You will have two show them your passport, driving license or any other proof of ID, the proof of your address and proof of your income.

What else do I have to note?

Before taking out a new loan first make sure if you really can afford the monthly repayments and then compare different lenders, check their charges and fees as well as the interest rates. Once you have found the loan which suits you best, simply click on “apply”