Loans: Personal Vs Secured

I don’t really like the idea of borrowing money or lending money to people, because I have an elephant’s memory and I still remember this girl borrowed thirty cents from me and did not return. We were in Primary One then. On hindsight, I think she must have faced financial problems at home, because she was always out of money. However, there are some children who lie just to cheat people out of their money.

However, when I went to the university, I got a students’ loan for the fees. My father paid for my education the day I graduated, so no interest was incurred. The computer loan was also paid off, not that we really needed to borrow, but since it was free, why not. I guess for those who really need the money, this is a great option, because you can use the money to invest and earn more returns than the interest, and in this case, there was no interest to be paid.

The next loan I had was when I bought my car. Without the loan, I would not be able to drive around independently. I nearly went crazy when I went to my soon-to-be-old workplace by bus and took the same exact tedious journey home. I was not going to spend 2 hours taking a bus everyday. Immediately I set to action and bought myself a car. The agent made me take a longer loan, just so that I would be comfortable paying off the monthly payments on my then meagre salary.

When I bought my house, apart from looking at our salaries, they checked out credit rating. I had always been prompt with my car loan repayment, and we got the loan from the same bank, so it was not a problem getting approval.

When I opened the letterbox today, there was an advertisement for personal loans. When people require loans, they must have the means to pay them off. If not, their credit report would be affected. The interest rate for personal loans tend to be higher than secured loans, because the risk is greater. In addition, it is possible to borrow a larger amount through secured loans, because you can use your house as collateral, and also at a longer repayment period. Again, let what I love to stress, whenever you want to borrow money, make sure you have the ability to pay off the loan. Sometimes, having easy loans is a bane. Always compare loans before you decide on the banks and the type of loans.