A money loan is a financial transaction in which the lender agrees to give the borrower a certain amount of money with the expectation of total repayment back to the money lender. The specific terms of a money loan are often spelled out in the form of a promissory note or other contract.
The money lender can ask for interest payments in addition to the original amount of the money loan. The borrower must agree to the repayment including the amount owed, terms, interest rate and due dates. Some money lenders assign financial penalties for missed or late payments.
A money loan can contain many hidden costs such as interest payments and finance charges therfore many people with bad credit tend to avoid applying for one until it becomes necessary for them. Purchasing a new vehicle or home almost always necessitates some form of financial money loan.
The most money loan applications are handled by banks. They use criteria to determine if a potential borrower is eligible for a money loan. They often check past credit history and current income and assets. The purpose of the money loan is also a important factor. One important consideration is the income to debt ratio of the borrower.
Loan involve money for eventual repayment with a cost involved beyond the original principal. The price for having a loan is generally defined by the amount of interest charged on a loan, but may also include transaction and processing fees.
You can take loan out for a number of reasons. Some of the most common motivators for a money loan include such things as purchasing a home or car, funding business activities or paying for education. The sources for loan financing might involve banks, credit unions and commercial lending institutions.