Borrowing Money For A Purchase-ppp13.com

Business There are many different ways of borrowing money one of which is a consumer loan. One type of consumer loan is an installment loan or a loan with a payment plan. This loan may be either secured or unsecured. A secured installment loan would be a car loan or a loan for a motorcycle where the lender keeps the title to the vehicle or motorcycle as security for lending you the money to purchase it. You are securing the loan with an asset. An unsecured installment loan is a loan to buy a lawnmower where the lender did not take a security interest in the item because usually it just is not feasible to do so either because the items value is low or it will depreciate just too fast. Or in other words you didnt have to use the asset- the lawn mower- to secure the loan. You need to read any loan agreements carefully because the terms of borrowing money may allow the lender to file a lien on either the item you had financed if it is a large ticket item until it is paid for. If this is in the loan agreement then you have allowed the lender to secure their loan to you. There are different forms of collateral a lender can take including your weekly paychecks. However consumer loan laws generally prohibit anything that may be considered excessive. An example is when you are borrowing money for a new bike then the lender cannot take a lien against your home because that value far exceeds the value of the item you financed. You can get a home equity loan if your home has value in it which is another form of borrowing money. You would have to go to a lender who does this type of lending and fill out the paperwork. This lender mayor may not be the original lender. But when you do this the second lender becomes a second tier lender on your home and they will file a security interest in your home which will get repaid when you sell your home or if you pay it off yourself over the time of the specified term of the loan. Different types of loans can have different interest rates attached to them. It may be a fixed rate loan which means you pay a level amount of interest over the duration of the loan. These may have a higher interest rate than a variable loan because the lender is loaning you the money at a set or fixed rate and if the market changes that money will cost more so the lender may be losing money on what you borrowed. A variable rate loan is one that is tied or pegged to some other rate like the Federal Reserve Bank lending rate. As this rate goes up or down, your interest rate goes up or down. This is the way many credit cards work. So there are different types of loans for many different purposes. About the Author: 相关的主题文章:

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