Loans are, basically a type of debt, which creates a redistribution of financial elements between a borrower and a lender. In the process of loan the borrower borrows a specific amount from the lender and uses that for his benefit and through this he is able to perform his obligation and fulfills his lively necessities. This ensures the relation between a lender and a borrower and through legal laws and order the money which is borrowed must be given back and in the given time so the process can be followed in a legal way.
Typically the loan is provided on the basis that the borrower will pay back the given amount in the mentioned installments and must pay the percentage of the amount decided to pay in every given installment. This is the necessity of most of the loans. The types of loans in which it is classified are basically 3 and these include, secured loans, unsecured loans and demand loans.
Secured loan is the type of loan that involves some property assets to be pledged in order to apply for this loan. The borrower must have to put his home or some property asset on mortgage to the money lender in order to get the amount of loan he needs. This type of loan is very common as most of the borrower when wants to get a new home or property and they apply for this loan the property is in hands of the lender if the borrower will not be able to get the amount paid back to the lender.
Unsecured loan is the type of loan that involves no property but involves some lenient packages that involves money in your account, your credit history, personal loans and bank overdrafts. These are the basic things that are mostly involved in the unsecured types of loans. And this is regarded as lenient as this does not have to take the property of a borrower in hands by lender.
The other and the most easily available type of loan are the demand loans. These are the short term loans that are available to the borrower on the short terms that is not more than 180 days means a period of 6 months. These demand loans can be called both secured as well as unsecured depending on the legality of the loans and paper work that has been done. One thing in this is the lender can call for money installment at any time regardless of the date specified before.