Classification of loans Classification of types of loans includes determining the degree of quality of a loan based on the history of the loan, the quality of collateral and the possibility of repayment, and then the result can be applied to the loan portfolio, as banks often develop their own rating measures, which include 12 categories ranging from -or – With little risk and no level or doubt, which indicates a high probability that the loan will be uncollectible, as well as a loss that indicates that the recovery is minimal or absent, so bank employees use a rating system when conducting a banking examination and Assigning their own estimates to the sample loan portfolio of the bank, as well as when assigning an assessment to receive a loan, the employee studying the loan looks at the documents, guarantees and financial statements of the borrower.
In different companies and institutions or to meet the specific financial needs of individuals or financial requirements, such as cars and others, here are some of the most important types of loans in any banking financial institution, namely: credit cards are used as credit cards to cover daily expenses, such as: food, clothing, transportation, minor home repairs, etc., as well as interest, when the monthly installment is not paid in full, and the average interest rates on credit cards are about 15 percent, but they can be low in the case of Proposals A temporary introduction, and the ratio can be up to 30 percent or more, depending on the history of payments and the credit rating of the client.
Personal loans This type of loan is suitable for those who want to lower
interest rates through financing companies under certain guarantees, such as guarantors, or by transferring monthly salaries in the case of banks, and, like other loans, the conditions of a personal loan depend on the credit history of the client , and loans can also be used.
A person for any personal expenses does not have a specific purpose, and this makes it an ideal choice for people with outstanding debts, such as credit card debt. Real estate loans Real estate loans are one of the types of loans that banks or financial companies provide to customers to buy houses that they cannot pay in full, or loans to joint-stock companies or real estate agencies for implementing several real estate projects.
These loans are characterized by a somewhat low interest rate. Small
Business Loans These loans are provided to small businesses and start-ups to help them open or expand a business called Small Business Financing, which offers various options to suit the needs of each company.
Education loans As part of this type of loan, university students and their families are asked to help cover the costs of higher education, and there are two main types; Student loans from universities and private student loans, one of its advantages is that they are usually offered at lower interest rates and more favorable payment terms for borrowers.
Car loans, such as mortgages, car loans, are related to information provided by the client, such as private property, and this type of loan is announced by the bank or directly by the car dealer, but it should be noted that loans provided by the agent may be more suitable. less often, they are associated with higher interest rates and, ultimately, higher costs.
Other types of loans There are many types of loans, and the most important of them are mentioned, but there are other types that depend on several classifications, in accordance with applicable laws and financial standards, as well as in accordance with the standards of the central bank in each country, and Some of the other types of loans are: [3 Take retirement and life insurance. Consolidated loans. Cash advances. Basic loans.