There are different types of loans and countless lenders. Below are the different types of loans in South Africa.
âWhen we look at the challenges people face in the modern world, we realize that most of them revolve around finances. A quick solution to a money problem is usually to borrow. Loans are repaid at different rates over different periods â.
These are loans acquired directly from a creditor for his personal use. Personal loans are granted based on your creditworthiness. One does not need to guarantee the security of the loan. They are mainly reimbursed by installments agreed between the creditor and the debtor.
With a secured loan, the person who gets the loan has to put a personal asset as collateral for the loan. In this way, in the event of default on payment by the agreed date, the asset will be taken as collateral.
These are loans paid in small amounts over time until they are fully repaid, mostly in monthly installments.
These are mostly given by the government to fund the education of students who are not able to comfortably pay up front. They are usually in large quantities and students are supposed to erase them when they are finished with their studies, not as a lump sum of course, but slowly over time they can take several years to erase.
To acquire a house that they call their own, people get these loans in an amount that they can comfortably pay off over time. The repayment of these loans can be varied according to the convenience of the debtor.
A business, most of the time in its infancy, can take out a loan to finance its operations until it can finance itself. Business loans work the same way as personal loans except that it is a business or business with debt, not an individual. They also have different repayment rates and periods.
In this case, 50% of your pension serves as a loan guarantee. You need a certain amount in your retirement or provident fund to get this R7,000 loan and deductions are made from your monthly paycheck until it is paid off.
These loans are taken out and repaid when the debtor is repaid again as the name suggests. Usually payment is made at the end of the month with the agreed interest rate included. It’s important to compare payday loans because some are much more expensive than others.
ASSET FINANCING LOANS
This type of loan is mainly used for the acquisition of assets, especially vehicles. Whenever one wishes to acquire an asset, he can get that loan and repayment at rates determined by the amount he has taken.
This is a loan used to cover unforeseen costs. It is granted by the bank at certain rates allowing to obtain what he needs even when the balance of his account is insufficient. Payment is made when the money is deposited into the bank account.
A well-managed loan will always easily solve financial problems. Money gives life, if you can get it as a loan and pay it off later, you need it!