According to Chron, the major advantages of a bank loan are stability and autonomy if the borrower is a small business. This source explains that banks lend money without taking ownership in the enterprise for which the loan is being used, so the borrower retains total autonomy as long as the money is paid back in time.Continue Reading
Chron explains that another major benefit of bank loans is that the lender can completely sever ties with the bank once the loan is repaid in full, while other types of lenders may require a continued relationship.
Opposing Views notes that bank loans are offered for a variety of purposes, from taking a vacation to paying for a child's college tuition. Bank loans are generally far more secure than payday loans, offering low and consistent interest rates to borrowers with good credit and a reliable payment history.
Opposing Views also explains that bank loans are far more flexible when it comes to money distribution, since banks don't typically impose regulations on how the loan is used once the borrower has been approved for a given amount of money. As long as the bank receives payment, the borrower can use his own discretion as to how to spend the loan.Learn more about Credit & Lending
Applying for a small business loan entails educating yourself on the process, gathering documents and filling out the application. Follow the lender's instructions carefully, ase an incomplete application or missing documentation can cause the lender to deny the loan.Full Answer >
According to Accounting Tools, a non-interest-bearing loan is a loan or debt on which the borrower is not required to pay interest. With this type of loan, the only amount due is the principal, or actual amount borrowed, as long as the borrower meets all other requirements of repayment. The source notes that this can also be referred to as a non-interest-bearing note.Full Answer >
The loan disbursement fee is charged by the lender when student loan funds are given to the borrower. It's also called a loan or origination fee, states the Department of Education. The fee varies by lender and is usually calculated as a percentage of each loan disbursement.Full Answer >
Having a vehicle repossessed does not remove the borrower's obligation for the loan. Once the lender repossesses the vehicle and sells it at auction, the finance company also has the right to sue the borrower for the remaining balance on the loan. This balance is called the deficiency balance, according to Nolo.com.Full Answer >