Short-term loans are usually extended by financial institutions generally for a period of 1-2 years. These are mostly unsecured, and need not required to pledge collateral as security to avail them. These are "short-term" as the associated repayment tenor can be paid off in full within 6-18 months rather than the speed of funding.

• Personal Loans:A personal loan is a credit facility that can help to meet the financial obligations. Personal loans can be categorised into Fixed Rate of Interest and Floating Rate of Interest.


• Gold (Jewel) Loans: Gold loan (also called loan against gold) is a secured loan taken by the borrower from a lender by pledging their gold articles (within a range of 18-24 carats) as collateral.


• Car and two-wheeler loan (Auto Loan): A car loan (also known as an automobile loan, or auto loan) is a sum of money a consumer borrows in order to purchase a car.


• Loan against securities:Loans against Securities are available in the form of an overdraft facility which is pledged against financial securities like shares, units and bonds. Loan against Shares/ Bonds/Mutual Funds are loans wherein the securities can be pledged that have been invested in as collateral against the loan amount.


• Loan against conversion of Credit Card: A credit card comes with a specified pre-approved credit limit which can be used by the holder in a month. However, if there is an urgent need for cash, most banks offer the facility of loans against credit card.


• Pay later option in Online Store: With the development in online shopping, the online stores have introduced a new type of payment method called "Pay later option". Under this method the customer can choose their favourite online store and shop their items and apply pay later option for 3/6/9/12 month EMI plans and activate the credit limit.

Long Term Loans are defined as a type of debt that can be repaid over an extended time, typically exceeding the time frame of a few years. This time period ranges between 3-30 years. These loans may have a fixed interest rate, or a floating rate based upon the prime rate or other benchmarks.

• Home Loan: A home loan (or mortgage) is a contract between a borrower and a lender that allows someone to borrow money to buy a house, apartment, condo, or other liveable property. A home loan is typically paid back over a term of 10, 15 or 30 years.


• Income tax benefit in Home Loans: The Government of India offers tax benefits on home loans under the Income Tax Act of 1961. Home loan borrower can get the benefit of tax deduction on principal repayment under Section 80C, tax deduction on interest under Section 24 (b), and additional home loan interest tax benefit for first-time homebuyers under section 80EE.



Sections in the IT Act	Nature of home loan deduction in IT	Maximum amount deductible
Section 80C	Tax deductions on the principal repayment	Rs. 1.50Lakh
Section 24	Tax deductions on the interest amount payable	Rs. 2.00Lakh
Section 80EE	Additional home loan interest tax benefit for first-time home buyers	Rs. 50,000
80EEA	Affordable Housing (some conditions to be fulfilled)	Rs. 1.50lakh



• Home Improvement Loan: Home Improvement Loans are secured loans taken against the mortgage of the property and can be used for remodelling, renovating, updating or making repairs to the present home.


• Education loan: An education loan is availed specifically to finance educational requirements towards school or college. Depending on the lender, it will cover the basic fees of the course, the exam fees, accommodation fees, and other miscellaneous charges.

A loan shark might:

• Offer little or no paperwork, such as a credit agreement or record of payments.


• Refuse to give information, such as the interest rate or how much you owe.


• Take items as security, such as passports, bank cards or driving licenses.


• Increase the debt or add additional charges at any time.


• Refuse to allow you to settle your debt.


• Get nasty - they might resort to intimidation, threats or violence.