Personal Loan

From Financial Literacy Wiki

Personal Loan are extended to individuals to finance their general expenses. The amount of loan given depends on the purpose of the loan and the collateral pledged. Individuals can take personal loans to renovate their homes, to purchase country club membership, to purchase shares or even to pay for general expenditures. If personal loan is unsecured, the amount of loan extended is usually small, say up to two times of an individual's monthly salary. However if you pledge collaterals with the lender, then the amount can be larger. Collaterals accepted by banks includes fixed deposits, stocks, property, gold certificates, unit trusts and golf club membership.

Interest charged on personal loans tends to be higher than those for housing or car loans. They can be quoted on a monthly-rest or a flat basis.