Loans depend on the purpose and whether or not they require collateral. Secured Loans require collateral, while Unsecured Loans do not. The collateral may be a house, gold ornaments, a car, or any other asset pledged to the bank against the borrowed amount.
Meanwhile, you can also apply for Loan without pledging collateral. Banks provide the desired amount after considering multiple factors, including your credit history, monthly income, repayment capacity, and eligibility. The interest rates are generally higher. Here are the Loans to consider for different purposes:
Home Loans
These are Secured Loans that provide funds to finance a house or property. There are different types of Home Loans available in India, such as Land Purchase Loans, Home Construction Loans, Top-Up Loans, etc.
Personal Loans
You can consider a Bank Loan to renovate your house, pay utility bills, consolidate debts, finance your vacation, and more. You need to pay higher interest rates and can use the amount for any need without further questions.
Gold Loans
Gold is the most favoured and safest asset. You can apply for Gold Loans by pledging gold items to the bank in exchange for funds. You can also choose the Loan type you want to apply for based on your needs and eligibility. Just repay the principal amount with interest at the pre-determined rate throughout the tenure.
Loans Against Securities
You can also offer Mutual Funds and shares as collateral in exchange for funds. When you request a Loan against them, its value is same as shares. You can also apply for Loans against Insurance Policies to get the desired
amount. However, not all plans fall under this category.
Business Loans
These Unsecured Loans are useful for meeting the business’ daily expenses or diversification. You need to submit the required documents and add a co-borrower to fulfil every business need, from expansion and working capital to your child’s education or an office renovation.
Two-Wheeler and Four-Wheeler Loans
When you apply for Loan to buy vehicles, you need to submit relevant documents and evaluate the total cost. Nowadays, most banks offer 100% financing of the total value of the bike or car, depending on the model, features, etc. The financing for a sports bike or car is higher than a regular one.
Education Loans
These cover the course fees along with accommodation, exam fees, etc. Here, the students are the sole beneficiary who repay the amount in instalments after completing the course within the agreed tenure. The parent or guardian can act as co-borrowers during application.