A loan is a borrowed sum from a bank or a financial institution. A person or entity who receives the money is called a borrower and the institution who provides the loan is called a lender.
A lender levies a specified per cent of interest on the loan based on the eligibility factors of the borrower, such as income, job stability, credit score, etc. For example, as a borrower, if you have a salary of INR 1 Lakh/month and you need a loan of INR 30 Lakhs, the bank will provide credit at a low-interest rate (8-8.5%) and for a lengthy tenure.
Here is the crux of loan concept – The borrower has to repay the loan amount, including the interest rate as imposed by the lender, over a prescribed period. Upgrade to Subscription - Reading Program to unlock this content!This content is locked
Note: You can calculate the approximate amount of EMI before applying for the loan through an EMI calculator which is available on most of the bank’s website.
Nowadays a good credit score (above 700) is required to seek approval for any type of loan.
Citations :
Power Words :
- Interest rate
- Collateral
- Tenure
- Seed capital
- Imposed
- Pledge
This content is locked
Upgrade to Subscription - Reading Program to unlock this content!
Hashtags :
- #GPSforLifeAndCareer
- #ConsciousIntelligence
- #Kidswiki
- #MindInTheMaking
- #RelevanceInEducation
- #MeaningfulLearning
- #RealWorldSkills
- #SafeContent
- #360DegreeDevelopment
- #Skillioma
- #BeyondCurriculum
- #SkillsBeyondSchool
