Loans

There are times when a credit card isn’t the best kind of credit to use. For example, if you want to buy something that costs more than you have available on your credit line or that you can’t possibly pay off in a year or two, you can apply for a loan.

For example, you can use a loan to:

• Buy a car
• Pay your college tuition
• Buy a home
• Start your own business

Some loans, such as car and home loans, are secured, which means if you don’t repay, the lender can repossess what you bought. Unsecured loans, including student loans, are backed only by your promise to pay what you owe. But repayment isn’t an option. It’s required.

 

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