Whenever the thought of loan comes, then the picture of banks definitely emerges in the mind. And even if it is not, in today’s time if you want a loan then you have to go to the banks only.
If a loan is understood in easy language, then it can be any thing, but mainly money is understood in it, it is taken from some other person, while returning it, along with the principal amount, interest is also paid. have to return.
As you would know that people need loans or loans to fulfill their various needs. Which he takes from a bank or financial institution, and then returns the amount taken by the loan along with interest to that bank or finance institute. So today, through this post of our Types of Bank Loans in India , we try to tell you how many types of loans are there?
How Many Loan Category are There
Loans are broadly divided into two categories, one is secured and the other is unsecured, Let’s Know
1. Secured: A secured loan is called that loan which is backed by collateral or security that too in the form of assets such as property, gold, fixed deposits and PF (Provided Fund).
2. Unsecured: An unsecured loan is called that loan which is a type of personal loan and which does not require any collateral, security or guarantee and it can be taken to fulfill your needs.
There are Three Types of Loans according to the Time Period
What is Short Term Loan
Short term loan is one which is given for a short period of time, its time period is short i.e. for a short period of time. Each bank has a different time frame.
Some banks or local loan providers keep this time from 6 months to 1 year and within this time you have to return the loan along with the interest amount. Some banks also offer short term loan tenures up to a maximum of 2 years.
What Is Medium Term Loan
As the name suggests, medium term loan is given for a medium tenure. The repayment time of this loan depends from bank to bank. Let us tell you that the time period for returning money in medium term loan is from 1 year to 3 years.
What Is Long Term Loan Meaning
Long term loan means a loan given for a long time. Let us tell you that long term loan is very popular in India, most of the people apply in the bank for long term loan only. If we talk about the time period, then in the long term, you are given the loan for 3 years to 30.
The specialty of a long term loan is that this loan is given for a long time and the interest rate is also low and the loan amount is also high.
Long term loans mainly come under home loan, car loan or certain types of personal loan. That is, if you are thinking of building your house or thinking of buying a car, then you can apply for a long term loan.
Apart from this, you can also apply for a long term loan for the purchase of machinery used in some big manufacturing business.
Types of Bank Loans in India
1. Personal Loan
Personal loan or unsecured loan means loan taken for self. Although all the loans are taken for themselves but personal loan means to take loan for your personal work, such as paying school fees of children or buying an expensive gift or taking any household items, then all these needs are met. The loan taken is a personal loan. Actually, every bank has its own interest rate fixed for them. As of today, State Bank of India (SBI) is charging an annual interest of 12.50% to 16.60% for personal loans, while HDFC Bank is charging an annual interest ranging from 10.99% to 20.75%. By the way, the interest rate of personal loan is higher than all other loans. For personal loan, the bank does not ask you for more documents, just after seeing your salary slip, gives you the loan. You can get a personal loan for up to five years.
2. Corporate Loan
When the bank gives loans to big people like Ratan Tata, Vijay Mallya, Reliance Industries, Tata Birla, then they are called corporate loans. According to the current rules, the bank can give a loan of up to 55% of its core capital to a large company as a loan. But in view of the increase in the recent default case, RBI has said that such a rule will be applicable till January 1, 2019, when banks will be able to give only 25% of their capital in the form of loan to any one corporate. So that the risk can be avoided. Types of Bank Loans
3. Gold Loan
In this loan, you can get a loan by keeping your gold in the bank locker. In this type of loan, the amount is given according to the quality and value of the gold deposited by you. Well, it is generally seen that the bank gives you 80% of the value of your gold as a loan. Gold loans are usually taken by people in case of emergency. The interest charged on this loan is less as compared to personal loan. At present, the gold loan interest rate is 11.15% in SBI and 10% per annum in HDFC.
4. Vehicle or Car Loan
When you take money from the bank to buy a vehicle, it is called vehicle or car loan. Car loan is offered at fixed or floating rate like any other loan. Fixed rate means that you have to pay the entire loan at the rate of interest at the time you are taking the loan. And the flooring rate means that after taking the loan, if the interest decreases or increases, then you will have to pay accordingly. In a car loan, the car is owned by the bank until you return the entire loan amount to the bank.
5. Security Loan
In this loan, banks give loan by keeping your security paper. But the question arises that what are security papers? If you have already invested in any mutual fund, demand share government scheme or bond, then this is your security paper, keeping which the bank gives you a loan. If you are unable to repay the loan, then the bank seizes your security paper, and sells it in the market. You can mortgage your security paper with the bank. The bank gives you the facility of bank over draft on the basis of this security paper. Overdraft means that even if you have zero balance in your account, you can withdraw money from your account, this is called overdraft.
6. Property Loan
Property loan is a loan in which the bank mortgages your property papers. Anyone can get this loan for a maximum period of 15 years. Usually, the loan is available in the range of 40% to 50% of the value of the property.
Sometimes we need so much money that it may take us many years to earn. In this case, we are left with only one option and that is our property. When we take money from the bank by mortgaging our house, land or farm, it is called property loan. When you go to the bank for this, they get an idea of the value of your entire property. After that let’s see whether you will be able to repay their amount or not. Based on this, they decide the loan amount.
7. Education Loan
It is not impossible for every student to be able to study in their favorite institute. If someone wants to study in Oxford University, then the fee is so much that it is very difficult to think of going there to study. In such a situation, he can take an education loan from the bank. Before giving education loan, the bank determines its repayment. The bank gives loan to the same student who has the ability to repay it. The bank works in two ways to know the potential of the student. Either the student’s guardian’s income is looked at or the university the student is going to take the loan, how is its performance? This is also seen. After the completion of studies, the student can pay the loan. A guarantor is required to take an education loan. It can also be a relative of the student. In today’s date, state bank of India education loan is 10.70% and 7.0% for education loan above 7.50 lakhs. Charges an interest rate of 9.95% p.a. for up to 50 lakhs. Types of Bank Loans.
8. Home Loan
The loan taken to buy a house is called a home loan. You do not take a loan only for buying a house, but you can take a loan from the bank by adding the cost of building the house, registration of the house, the cost of stamp duty and many more. The bank gives loans ranging from 75% to 85% of the total cost of building a house. You have to do it yourself to make the rest of the money a house. Suppose you have taken a loan for a plot whose value is 10 lakh rupees. For this, you will have to deposit only 30 percent of it i.e. three lakhs in the bank. The bank will give the rest of the money to you. The home loan repayment time ranges from 5 years to 20 years. In addition to the interest, the terms of the home loan include various other fees, such as processing fees, administrative charges, legal fees, assessment fees, etc.