– Information about lending money –
A loan means that you lend money from a person, a company or an institution, and then pay back the money with interest (fee).
In other words – you pay back more money than you borrow.
“Interest” is the fee that the company charges you to be able to run it’s business.
When borrowing money, one should check that the effective interest rate is as low as possible.
Then the loan will become as cheap as possible.
The type of loans that are usually the most dangerous to take, are short-term loans and blanco loans.
It is therefore slightly better to take long-term loans.
Other dangerous loans are mortgages, because it often costs more than you think to be done with your house. It is not uncommon that people take 4-5 loans to renovate their home and it will not though be finished.
When should you take a loan ?
A loan should be taken when all other outings are closed, in order to survive.