Loans are financial tools that allow individuals to access funds they don’t currently possess. They come in various types, including personal loans, auto loans, mortgages, and student loans.
When you borrow money, you agree to repay it over a specified period, typically with interest. Loans may have fixed or variable interest rates and can be secured (backed by collateral) or unsecured (not tied to specific assets).
To make informed borrowing decisions, it’s essential to understand loan terms, interest rates, fees, repayment schedules, and the potential consequences of defaulting on a loan.