The use of loan

Loan is a temporary provision of money made available to you with certain interest rate. The word temporary means the money is available just for awhile and must be paid back with interest which could be at once or in installments base on terms and conditions.

Many people don't understand the meaning of loan, its usefulness and the risk involved in obtaining loan. Some people obtain loan to buy luxury, personal wears, or to pay another debt forgetting that they are still going to pay the loan with its interest back in a short while.

That's why it's not good to obtain loan to start a business except the business can earn you immediate profit which can be use for repayment of the loan incurred.
 

Maks25

Active member
People often take personal loan online because it is easily available without definition of what they want to use the loan for, forgetting its a loan and you ‘ve to pay back with interest. I think personal loan normally taken to finance an emergency, such as to pay off debt or for home improvements. The lender asks for a reason. However, the decision on your application to some extent are not dependent on it. Still, be clear as to why you need the loan? Arriving at the reason would help you debate on whether you truly need it or not. Remember It’s a loan, and you have to pay more money than you’ve borrowed. Be clear with its objective.
 

Noor Fatima

Member
Loan is a temporary provision of money made available to you with certain interest rate. The word temporary means the money is available just for awhile and must be paid back with interest which could be at once or in installments base on terms and conditions.

Many people don't understand the meaning of loan, its usefulness and the risk involved in obtaining loan. Some people obtain loan to buy luxury, personal wears, or to pay another debt forgetting that they are still going to pay the loan with its interest back in a short while.

That's why it's not good to obtain loan to start a business except the business can earn you immediate profit which can be use for repayment of the loan incurred.
Sometimes it's necessary to take some money from someone to start a business but I prefer to take it from any friend ,relative or known person rather than from bank because it case of bank we have to return more than real we take it so it automatically increased so I don't prefer to take loan from bank
 

btaliat

VIP Contributor
Loan should be used for business purpose only. But I do see people using loan for building of houses, purchasing of cars and even use it to carry out some functions like wedding, burial among others. I don't really know the reason behind that. But as far as I am concerned, loan should be used for pursuing any venture that is capable of bring in money. The reason for this is very simple, it will make the repayment of the loan faster and even easier. So, we should try to obtain loan when we are sure that the business is capable of bringing in money to avoid stories.
 

Thosynho

Member
Loan should be used for business purpose only. But I do see people using loan for building of houses, purchasing of cars and even use it to carry out some functions like wedding, burial among others. I don't really know the reason behind that. But as far as I am concerned, loan should be used for pursuing any venture that is capable of bring in money. The reason for this is very simple, it will make the repayment of the loan faster and even easier. So, we should try to obtain loan when we are sure that the business is capable of bringing in money to avoid stories.
You are not too correct with your assertion. Loan is not only meant for business purpose. Have you heard of mortgage loan, car loan and other stuff?

Mortgage loan is a loan you obtain to build or buy house but you pay in installments most often it's withdrawn directly from your salary source or you pay directly to the company's account. Most of the mortgage loan have a long time repayment that runs to years but you pay monthly.

Car loan too exist and it's good for people who use their cars as asset that is for commercial purpose or people who whom the nature of their work demands car. And so on.
 

Mataracy

VIP Contributor
Loan is good when it is use for what is good.
When one obtain load is either you want to use to finance your business, to build house or to pay school fees.Loans can be obtaine when there is urgent need.
But some people that do not know the meaning of loan might even take to do something that is not necessary.
 

Ralphjoe

Active member
I don't think there are actually people that will take loans from Bank to do some frivolous things for themselves without actually using it to start business, knowing fully well that they will have to repay these loans with interest on them. If for a fact that such kind of people actually exist, then those people are setting themselves up for big trouble and failure because banks will never forfeit their loans just like that and before they grant you your loan request, you must have a collateral so that means that bank wiol seize the person's collateral and that is it.
 

Sammyesx

Active member
Loan is never a first choice, most people take a loan because they have noj other option, I don't think anyone will want to get a loan for the sake of frivolities, people often think of frivolities when they have extra not when they lack money, because the reason for getting a loan at the first place is as a result of lack of money to solve a personal problem or for business purposes. Getting a loan to start a business is a business is not too ideal unless one has no other option because getting a loan to start a business puts one in undue pressure, Which might have an adverse effect on the business.
 

Donkiz

Active member
Loans can be beneficial if they are judiciously utilized. Loans are among the easiest way to raise funds to expand a business, many big businesses that we have today used loans to grow their businesses.

The problem that most people have is that they collect loans for the wrong reasons. Loans are beneficial only when they are used for business or short term investment, and not for consumption.

Do not use loan to start a new business, you can collect a loan to expand your business after it has stabilized.
 
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