Loans

RECENT NEWS
NPR  2 hrs ago  Comment 
The Consumer Financial Protection Bureau is readying new regulations on payday loans and other high-cost forms of credit. Officials with the agency say the loans can trap borrowers in a cycle of debt.
Finance Asia  3 hrs ago  Comment 
A roundup of the latest syndicated loan market news.
Yahoo  4 hrs ago  Comment 
The U.S. consumer financial watchdog on Thursday outlined its plans for cracking down on the payday lending industry and ensuring that borrowers can repay their loans. The framework unveiled by the U.S. Consumer Financial Protection Bureau was a...
Wall Street Journal  10 hrs ago  Comment 
The Energy Department is dusting off a loan program meant to help auto makers and their supply chain finance investments in fuel-efficient vehicles, announcing a $259 million loan to Alcoa.
The Australian  Mar 26  Comment 
Packaging group PaperlinX is in talks with its European financiers amid fears it may have breached the terms of a loan.
Wall Street Journal  Mar 25  Comment 
Regulatory guidance that seeks to limit the use of borrowed money in corporate takeovers has hit the private-equity industry in its bread-and-butter business of debt-laden acquisitions.
The Hindu Business Line  Mar 25  Comment 
Conversion of short-term loans into term loans, among guidelines
Wall Street Journal  Mar 25  Comment 
Bank of China became the second major Chinese state lender this week to post its slowest annual profit growth as a publicly traded company.
Financial Times  Mar 25  Comment 
Disappointing earnings reflecting rising defaults ominous as other lenders prepare to report




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Loan

A loan is an arrangement to borrow money. The lender provides the money with the understanding that the borrower will return the corpus in the future plus interest which gives the lender an incentive to lend out the principal.

Investors use many types of loans for example it could be a purpose loan using securities as collaterall with proceeds from the loan being used to purchase additional securities. [1] Or it could be a Hypothecate loan pledging securities as collateral for a loan to use for a specific purpose, without giving up ownership of the securities. [2]


Loans can broadly be categorized in to two variations:

same day loans

Secured Loans

This is the kind of loan where the borrower pledges some kind of collateral as a security until the principal is paid off completely. The most common example would be a Mortgage Loan, where the lender holds a lien on the house title until it's paid off in full.

Same day cash loans

Secured loans that lack sufficient collateral can sometimes be made by having the lender secure a guarantee from the SBA. Quickcash

Each lender will have their own underwriting criteria for a secured loan, but typically the following five factors of the borrower are considered: 1.) Capital 2.) Capacity 3.) Collateral 4.) Conditions 5.) Character [3]

12 month loans fast

Unsecured Loans

This is the kind of loan where the borrower does not provide a collateral. But, generally should provide proof of regular source of income and / or stable job so that the lenders can weigh their risk and come up with an interest rate for the term of the loan.
Examples would be, credit card loans, personal loans etc,.

13c, to lend, to borrow, originally, to let have, to leave (to someone), gift, loan is attested from 1620s, Loan word (1874), loan-translation is attested 1933. Slang loan shark first attested 1905. [1]

References

  1. A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing by Burton Gordon Malkiel ISBN-10: 0393062457 pg295
  2. A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing by Burton Gordon Malkiel ISBN-10: 0393062457 pg182
  3. http://bizplancompany.com/the-5-cs-of-lending/
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