In today’s day and age, there is a loan available for every need. Whether it be a small amount or a large amount, financial institutions have become very consumer-centric in the last 20 years. This also means that more loans are available today than ever, which may lead to confusion. From personal loans to a house loan, everything is covered these days.

Here are a few types of loans that you can get

• Personal Loans

These are unsecured loans that one can apply for. Unsecured means that the person lending the money would not take collateral in exchange for the credit. These loans can be used for anything to fund vacations to get the house renovated. Documents required for a personal loan are minimal.

• Credit Cards

Every time you pay with a credit card, you are essentially taking out a personal loan for an expense. Interest is charged if you cannot pay the balance in full almost immediately. If a debt or an amount of the debt is unpaid, interest is charged on it every month.

These are an expensive way to borrow money as they have an average interest rate of 16%.

• Home Equity Loans

This is for people who own their homes already. You can borrow against the equity your house has built up in it. If half the house’s value has been paid off, they can borrow half the amount of the house.

Equipped with this knowledge you can choose the type of loan that suits your requirement the most. 

Must Read: 5 TIPS TO AVOID REJECTION ON A PERSONAL LOAN APPLICATION