Loans – What Types Of Loans Are Available
Getting loans has always been difficult when working with a bank. Tons of paperwork, credit checks, and Fico scores can make most people’s heads spin. It can be especially daunting when you consider all the types of loans that are available. There are loans these days for just about everything. There are car loans, bad credit loans, equity loans, title loans, payday loans, and so on. Knowing what is available can go a long way to making the entire process of obtaining a loan easier.
Each type of loan comes with different conditions. Secured loans, for instance, are loans where you are putting something up as collateral in case the loan is not paid off. For example, a car loan uses the car as collateral, a mortgage the home or property you are using the money for becomes the collateral. Unsecured loans are loans such as credit cards or student loans where there is no collateral for the loan.
These types of loans are generally offered through large companies or banks. There are other loans that are offered through smaller companies or individuals. For example, a payday loan, auto title loan, or pawn shop loan are several types of small loans that can be done without a credit check and are considered to be secure loans because collateral is being offered. These loans are also considered to be instant loans. To receive them you bring in the items you wish to pawn, a clear auto title or proof of your paychecks and employment and they give you the loan. There are no waiting periods while credit checks or other paper work is filed and examined.
Auto loans come in two types as well. These two types are called direct and indirect. Direct loans come from a bank and go directly to the consumer who then uses them to purchase the car. Indirect loans are generally done through a third party. This is often called in-house financing. This is where the person offering the financing actually takes out the loan and then offers to finance the car buyer. These types of loans are generally more flexible when it comes to repayment and companies that offer these types of loans have a more personal touch and are often more willing to work with individuals who have fallen on hard times.
Loans come in a variety of sizes with a variety of conditions. Knowing all of your options before you take out a loan can go a long way to making sure that you avoid the pitfalls that can come with some kinds of personal loans and that you get the loan that is going to provide you with the best conditions for your situation. Research is always one of the first steps to making sure you are protected when it comes to financial situations. Take the time to look into the loan options that are available for your situation before making your decision when shopping for a loan.