What is a loan?

PODNickerz

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I heard it is borrowing money from the bank and that you can pay them back in a number of years time, but is there a catch?

Also, would it be different in australia than in america?


Thanks
:)
 

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Yes the catch being you have to " pay back " more than you had originally borrowed to the lender , in this case a bank. And i believe banks are generally the same world-wide .
 
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Another catch is that your pretty much tied down for the amount of time for the loan.

If you fall behind payments then your kinda screwed.
 
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When you take out a loan with a bank, you get a certain amount, and you pay that back and more. Loans can be somewhat different depending on what exactly your doing. What the bank gets in return for loaning you money is you pay back interest on the loan. So if you take out several thousand dollars, your likely to end up paying back the bank exactly how much you took out and a few thousand more.

Depending on how good your credit and such is, will affect the interest rate on your loan. If your credit is really bad, your likely not to get the loan or to have an extremely high interest rate.
 
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The Canadian humorist, Stephen Leacock (yeh, there are some:D :D - Gib will confirm:confused: ), wrote on this subject in about the 1930s.

All depends, PodN, if you are just a regular sort of guy, a major corporation or a Third World state.

If you are a regular guy, then you'll probably borrow, sub-prime: i.e. far above normal rates of interest - and repay.

If you are a major corporation and you are big enough, then you can re-negotiate the loan or threaten to go into Chapter 13 (Bankruptcy)!:D

If you're a Third World State, then when the principal and interest is due you immediately default: the World Bank and the IMF pick up the tab and eventually you "Re-Schedule" which means in simple terms never, ever pay it back!

And it's us poor saps that pick up the tab when we want a mortgage, personal or small business loan!:p :p :p

Paq
 

PODNickerz

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ok i know more about this subject now

i'll ask more people and learn more

Thanks! :)
 

PODNickerz

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Also, does anyone know of a site or something which explains to me about all the interest and loan and other information ?
 

PODNickerz

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Bump!

What's the difference between a homelone and a personal lone?

Only thing i notice is you can borrow alot more money
 
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A "Home Loan" is secured on a house.

A "Personal Loan" is guaranteed only by the borrower's ability to repay. If you default, there is no security.

Default on a Home Loan and you find yourself on the street!

That's why the rates are cheaper for Home Loans.

Paq
 

PODNickerz

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So i should be going for a home lone?


btw: If you are currently paying off a loan and you die for some reason, what would happen?
 
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Home loan HAS to be for a house (at least as far as I know). As already mentioned, you can borrow more and have the lower rates on the home loan because you are loaning money for a house, and if you do not pay the loan back, they take away your house.

If your not buying a house, then your looking at a personal loan.


If your paying for a loan and you die before you pay it off, obviously, you (physically speaking) will not be able to pay it off yourself. In such a situation the beneificiary of your estate would become responsible to pay it off. If you do not have one or they are unable to get enough to pay your loan off, then I believe they would attempt to auction off your belongings to pay it off. At least that is sort of the basic run down on it.

Your not planning anything are you? lol ;) (j/k)
 

PODNickerz

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Oh, i thought u could use home loans for other stuff too.

Well, Thanks for the info

:)
 

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