Loan Article Resource Blog


Loan 101

Posted in Loan Services by elitemoneylenders on December 6, 2011
Tags: , , ,

personal loanLoan is a settlement in which a money lender gives money or property to a borrower or an organization borrowing money.  The borrower thenagrees to return the property or pay back the money, usually with interest at a given schedule or mode of payments. There is usually a proposed schedule for repaying the loan, depending on the agreed time / schedule of both the lender and the borrower, but the lender has to generally bear the risk that the borrower may not have the capability to repay the loans in time or not at all. The process of having a formal agreement where in it involves documents and legalization of conditions between the two sides is very important, especially when it involves large amounts of money or a large property.

There are different kinds of loan; Demand Loan is if the full loan payment is insisted by the lender. Installment loan is if the loan can be paid in equal monthly payments. Time Loan is if the loan is paid in one full payment over its maturity date. Loan categories such as consumer, commercial, and industrial loans, construction, mortgage, and credit loans, and secured and unsecured loans are naturally being classified by banks. However the bank allows promissory letter or promissory note from the borrower for the legalization of the loan process between two parties, especially if it involves large amounts of money.

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