Important things you should know about loans

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The use of the credits raises a significant amount of situations of the personal, familiar and business economy of these times. Misuse of credit can lead to an economic problem. The loan is therefore useful and the problems are caused by us, when we make an inappropriate use such as getting a debt more than our ability to pay. The loans can be for individuals or for companies or legal entities. To borrow properly, it is important to take the credit indicated for our case, for example, to know exactly the amounts of payment of principal and interest. There are many types available, one of them is one-year loan, which requires quarterly payments of 25% of the capital, it is very likely that this type of instrument is not suitable for a natural person and it would be better to seek a loan for installments, for example to three years.

The credits for natural persons are usually those of consumption (purchase of vehicles or credit cards). They can also borrow to set up a business or purchase an asset. The credits can be short, medium and long term as you as the borrower needs to look for the option that suits you best and remember. But you should not borrow if you have doubts or do not understand exactly the obligations. Obviously, the main recommendation that we give you, is that you should borrow from the bank of your preference, but you can get another option, the short loan companies that can provide to you, loans for bad credit no guarantor no fees instant decision.

Do not put money in institutions, companies or with people who are not regulated and supervised. Another aspect of interest when it comes to borrowing is that rates are attractive, even the highest of credit cards that are at 29%, since all rates are below inflation. Based on this fact, now is the right time to borrow and buy an asset or make an investment. If you also qualify for an activity that has regulated rates such as agriculture, tourism, manufacturing or housing, the recommendation to borrow becomes stronger. It is a good business to borrow, as long as you have the ability to pay.

In the case of companies I will refer to the main modalities: They represent the money received from a financial institution and the net credit balance of current accounts held in banks’ books. Bank loans are requested for a number of reasons, among which the following may be cited: (1) working capital financing; (2) purchase of inventories; (3) acquisition of fixed assets; (4) cancellation of debts.

A working capital loan is received when a company requires cash to pay off short-term debts or to purchase any good that is readily realizable. When this type of financing is requested, reasonable security should be available in obtaining sources of income for the cancellation of the debt.

The second option that may require a loan to a financial institution is for the purchase of inventories, which are goods that are made in the short term. The third reason is the acquisition of fixed assets, which is intended to take a debt that will be invested in the acquisition of a long-term asset that must be used in the generation of operational revenues.