One of the easiest ways to explain the term loan is by saying that it’s when somebody borrows you a certain amount of money for a fixed period of time. Until you completely pay it off, an interest rate is added to the total amount.

Those of you who know what the word loan means probably aren’t familiar with the different types of loans that are at your disposal. If you would like to know more about them, then keep scrolling because we are about to provide you with some useful information.

Less Known HDB Loan

So what do we know about this one? Namely, an HDB loan is particularly alluring to the ones who cannot decide whether they want to use this type of loan or a bank loan. And this decision can be a bit scary for the ones who are purchasing an HDB flat for the first time.

Most financial experts will tell you that for the time being, it’s much better to opt for an HDB loan because it has a much lower interest rate in comparison to bank loans. Another great thing about it is the fact that you can repay it back early without dealing with any penalties which makes it very flexible.

Moving On To Personal Loans

Many people find personal loans to be very appealing due to the fact that you can use them for literally anything your heart desires, depending on what’s currently urgent for you. Some people will use it for things like home renovation projects, some sort of emergencies, etc.

As we said, whatever is your priority at this very moment. These kinds of loans are typically unsecured. So what does it mean? It means that you do not need any collateral in order to apply for them.

What Do We Know About Secured Personal Loans?

We previously mentioned unsecured personal loans, but what do we know about secured ones? If you decide to borrow cash this way, then you’ll be obligated to give some sort of collateral which can be your vehicle, for instance.

This way you’ll secure this loan. So what’s the difference between this one and unsecured personal loans? Namely, this one offers a lower interest rate because it’s less risky due to the fact that you have an asset that serves as some form of guarantee that you’ll pay off your loan.

Student Loans

Young people who do not have the means to pay for their education (graduate school and college) normally opt for these loans because, with their assistance, they’ll be able to accomplish that.

In addition, these loans can be received from both private lenders and the federal government. Most students choose federal student loans because they provide forbearance, deferment, income-based repayment alternatives, and forgiveness.

When it comes to the ones that were offered by private lenders, they typically demand a credit check and every lender has the right to determine its own fees, loan terms, and interest rates.

Borrowing money is nothing to be ashamed of and something that a vast majority of people have done at some point in their lives. With this article, we wanted to give you a glimpse of the things you can expect if you opt for some of them.

Published by HOLR Magazine