Borrowing of money from someone is simply called loan. It could be a personal loan , which is procured from personal sources or a Institutional loan which is borrowed by any financial institution including Banks , Finance companies etc. Loans are borrowed by both individuals and as well as companies and corporate though the need , amount , term and interest vary in each case.Loan may be taken to meet certain requirement which requires a lump sum money and due to cash shortage.Which would be paid back to the lender with interest either in E.M.I (Equated Monthly Instalment) or down payment at once.Institutional loan are generally Instalment based while Personal loan are under down payment option.An interest is to be paid as remuneration to the lender for period the loan is used. The interest varies from source to source but overall it is guided by the credit policies of R.B.I including the Repo rate (The rate at which all banks get loan from R.B.I ), reverse repo rate (The rate at which banks could deposit there extra funds with R.B.I) C.R.R(Central reserve ratio is the minimum percentage of the total deposit with the bank to be kept with R.B.I to secure the interest of the depositor in case of any bankruptcy or liquidation of the Bank. Different Banks and institutions rate of interest varies as per there personal financial position , liquidity , existing loans sanctioned , existing deposit and there speculation of changes in interest rate in future.
SECURED LOAN :
loan against which a security is mortgaged with the lender is a secured Loan. This loan may also be reffered as collateral loan.After complete repayment of loan with interest for the period the mortgaged security is returned back As the risk involvement in this type of loan is minimum so secured loan is available at the cheapest rate in comparision or any sort of other loan. The execution of secured loans are also the fatest.Auto Loan , Home loan are most common secured loan.It is found that generally Institutional loan are secured lenders while private loans are unsecured loan lenders.
Secured Personal Loan :
It refers to those P.L (Personal Loans) which are sanctioned against mortgaging a security with the financer. After complete payment of the loan with interest till date , a N.O.C is issued by the lender and the security kept is returned back in as it is condition.
Secured Loan Rate :
The interest rate at which a secured loan could be procured is said to be a secured loan rate. Various banks and financial institutions offers different secured loan rate. In order to get the best secured loan one may check out and compare the offers before opting for any.This market study will help to determine the bestSecured loan.
Secured Home loan :
Buying a home financed by third party is home loan. Home loan is called a secured loan as the payment to the owner is made directly to the owner of the property and the title of holding remain with the financer.It could be said as hypothecated with the financer. After complete payment of home loan is made by the borrower the party gets a No Objection certificate and the legal rights to get the title of the property. In case the borrower gets defaulter the financer has got the rights to liquidate the property to realize the financed amount.