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Understanding Different Types of Bank Loans in India

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Check Different Types of Bank Loans in India: Personal Loan, Home Loan, Credit Card Loan, Car Loan, Two-Wheeler Loan, Education Loan, Loan Against Property. – PowerPoint PPT presentation

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Title: Understanding Different Types of Bank Loans in India


1
LOANS AND DIFFERENT TYPES OF BANK LOANS IN INDIA
2
A loan is when you receive money from a friend,
bank or financial institution in exchange for
future repayment of the principal and interest.
They can be unsecured, like a personal loan or
cash advance loan, or they may be secured, like a
mortgage or home equity line.A loan may be for
a specific, one-time amount or can be available
as an open-ended line of credit up to a specified
limit or ceiling amount.
DEFINITION OF LOAN
3
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4
Difference between Secured Unsecured Loan
  • SECURED LOANS
  • UNSECURED LOANS
  • As the name suggests, secured loans are the one
    that keeps an asset as a security to assure that
    the loan is repaid. In case of any default, the
    bank is liable to keep the asset, kept as
    security at the time of the loan, and get the
    amount back.
  • Types of Secured Loans
  • Car Loan
  • Mortgage Loan
  • Home Loan
  • Unsecured loans are the loans that no collateral
    or security and offered purely on the basis of
    credit score and credit history of the borrower.
    Lenders find unsecured loans unsafe as there is
    no collateral to recover the amount in case a
    borrower defaults the loan, therefore, unsecured
    loans are offered at higher interest rates.
  • Types of Unsecured Loans
  • Personal Loan
  • Education Loan
  • PayDay Loans
  • Credit Card
  • Signature Loan
  • Peer to Peer Loans

5
TYPES OF LOANS
  • Marriage Loan
  • Car Loan
  • Two Wheeler Loan
  • Travel Loan
  • Loan Against Property
  • Credit Line
  • Personal Loan
  • Cash Loan
  • Business Loan
  • Consumer Durable Loan
  • Education/Student Loan
  • Home Loan
  • Medical Loan

6
PERSONAL LOAN
  • Personal loan is an unsecured amount of loan
    borrowed by an individual on the basis of various
    criteria. Personal loan depends on a level of
    income, CIBIL score, scope of repayment and
    history of employment.
  • This loan serves the personal needs of an
    individual at the time of financial crunch. Upon
    the amount required by an individual, he/she can
    calculate the interest he has to pay monthly and
    estimate the instalment he/she has to take out.
  • Personal loans take the least time in getting
    approved with minimal documentation since a
    person is in urgent need.

7
CASHLOAN
  • Cash loans are small assistance to an individual
    at the time of need. They are small amounts given
    on small tenure and get sudden approvals and
    disbursal to make the borrower feel at ease.
  • Cash loans are usually taken by the individuals
    who do not maintain a bank balance but have the
    capacity to repay the amount in short duration.
  • Cash loans offer small amounts that do not extend
    beyond a year. They are unsecured loans but banks
    give some means to ensure that the amount is
    repaid.

8
BUSINESS LOAN
  • Business loan is an amount offered to meet the
    objectives or immediate requirements of a
    business. This loan is given understanding the
    customer requirements, therefore, it is a
    customized deal between a lender and a borrower
    that is decided looking at the borrowers need.
  • Business loans are subject to easy availability
    and can be availed by anyone but make sure YOU
    NEED IT ! 
  • It is offered on minimum initiation charges and
    is usually an unsecured loan but there are some
    terms and conditions at the time of agreement
    that you need to abide with in order to get a
    smooth processing and a comfortable experience.

9
CONSUMER DURABLE LOAN
  • Consumer durable loan is an easy option to
    finance the household items like refrigerators,
    microwaves, washing machines, air conditioners,
    television, chimney, etc. it gets difficult to
    shed a huge amount at one go, therefore, such
    friendly options have been made available to the
    public to use it to their best to lead a
    luxurious as well as a stress free life.
  • Most home appliances have become a necessity more
    than a luxury therefore every individual wish to
    possess the minimum possible to lead a
    comfortable life.
  • However if someone cannot pay at one go, it is
    the best option to take a consumer durable loan
    that is favourable for a borrower and continue to
    pay easy EMIs.

10
EDUCATION/STUDENT LOAN
  • An education loan is a respite for the students
    whose ambitions purely rest on education. The
    students who are hardworking only know the value
    and the hard earned money they spent on it adds
    more value to their education.
  • A student is a primary applicant and his/her
    caretaker, parents, guardian or guarantor can be
    co-applicant. The co-applicant has to take the
    responsibility to repay the loan amount.
  • Education loan covers the entire fees of the
    course, examination fee, accommodation fee and
    all the other expenses associated with the course.

11
HOMELOAN
  • Home loan or housing loan is a certain amount of
    money borrowed by an individual to purchase a
    house or any piece of residential property for a
    specific time period. The amount is lent with
    some interest amount that has to be paid along
    with the principal amount.
  • Once you clear your eligibility criteria, decide
    the type of home loan catering to your
    requirements. Here are some of the loans you can
    avail
  • Loan for home purchase
  • Loan for land purchase
  • Loan for home construction
  • Loan for home improvement, renovation or
    extension
  • Joint Home loan
  • Loan for stamp duty
  • Home loan for Balance transfer
  • Bridged loan

12
MEDICALLOAN
  • Extended under the category of personal loan,
    this loan is taken to fulfil the financial needs
    at the time of medical situation. If there is a
    sudden operation suggested by the doctor, some
    therapy or accidental situations, this loan can
    help you get away with finances.
  • Avail the medical loans when the insurance cannot
    cover the expense. Insurance amount is generally
    not high as compared to the amount lent on loan.
    Be aware of the offers available in the market
    and in case of emergency, just get the loan
    easily.
  • Medical loans are one of the most availed product
    in the market since it is user-friendly. 

13
MARRIAGE LOAN
  • Marriage loan has a lot of similarity with
    personal loans but stand true to their name as
    they are used for financing the marriage
    ceremony.
  • Low EMIs therefore easy repayment
  • Early loan approval, early disbursal
  • Flexible duration of repayment
  • Pre-payment option available
  • Customised offers
  • Interest rate varies from 10 to 20. The range
    is variable.
  • Minimal extra charges
  • No guarantor

14
CAR LOAN
  • Fulfil your needs by applying for an easy car
    loan and make your dream of owning a car come
    true. Just a few documents, verifications and
    background check can fetch you your dream car. 
  • Either you want to purchase a new car or you want
    to purchase a second-hand car. Those are the two
    possible options. The third option that is
    offered by some of the banks is a loan against
    car where you need to mortgage your old car to
    the bank as collateral and take a loan against
    it.
  • Loan amount, interest rate and duration of loan
    differ when you compare new cars to old cars. It
    is quite natural that new cars are expensive,
    therefore the car loans against them are also
    expensive.

15
TWOWHEELERLOAN
  • There are two major types of two-wheeler
    loans secured loan and unsecured loan. As the
    name suggests secured loans keep a security but
    are offered on lower interest rates. However, the
    unsecured loans do not keep a security but charge
    you higher at the same time considering safety
    for the amount offered. As a result, you end up
    paying more. Hence, the choice is yours which one
    to choose depending on your priority and
    requirement.
  • Two-wheeler loans are the most customer friendly
    loan option available in the market that does not
    only help you to lead a hassle free life but also
    makes life easy for you and help manage your
    finances. 

16
TRAVELLOAN
  • Travel Loan also known as a holiday loan, it is
    personal loan offered to bear your travel
    expense.
  • The entire amount is disbursed to the account to
    be used by the borrower at the time of need.
  • Travel loans can be used anywhere. It caters to
    all travel related expenses. The amount gets
    disbursed in the account and it can be used as
    and when needed. Travel loans get easy approvals
    with a few documentation. The loan amount gets
    disbursed once the verification is complete.
  • Travel loans are offered on low-interest rates
    but there are other factors that decide the
    interest rate. Usually, interest rates vary from
    11 to 20. Choose the best interest rates
    available.

17
LOANAGAINSTPROPERTY
  • Need money instantly for business or something
    personal, get a loan against property. Keep your
    property residential or commercial as a security
    and get a loan for the market price of your
    property. In the process, you can continue to
    stay in that property, it just serves as a
    collateral for the banks for giving loans on such
    big amounts. 
  • When there is an emergency, a wedding, business
    requirement, medical emergency, etc. loan against
    property is an easy option available that is
    faster and easier.
  • There are several charges over loan against
    property that an individual might not be aware of
    but it is advisable to know every extra amount
    charged to know the exact payment you are paying.

18
CREDITLINE
  • Credit line, also known as line of credit is a
    collective amount of money available to the
    borrower for use as per his requirements. The
    lending agency sets a limit as requested by the
    borrower. He/she can extract any amount up to the
    maximum limit set by the applicant.
  • The most interesting feature about this kind of
    loan is that the borrower neither has to use the
    entire amount at once nor does he/she have to pay
    interest for the entire amount. The amount used
    by the borrower is only subject to interest.
  • This loan is quite suitable for those who are not
    sure about their financial requirement but are in
    need now and then.
  • It is a flexible loan that can be utilised when
    there is a sudden and an urgent need for
    finances, however, the amount needed is not
    fixed.

19
THANK YOU !!
THANK YOU !!
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