Retail loans are credit products designed for individual consumers rather than corporations, typically used for personal, family, or household purposes. Key examples include home loans (mortgages), auto/vehicle loans, personal loans, student/education loans, and credit cards. These, which can be secured or unsecured, help individuals finance purchases like property, cars, or urgent expenses.
Here's a closer look at some common types of retail loans offered by banks:
Retail lending products include consumer loans, credit cards, auto loans, student loans, and loans to individuals secured by their personal residences, including first mortgage, home equity, and home improvement loans.
Personal loan, home loan, vehicle loan, education loan, gold loan, loan against property etc.…, fall under the category of retail loans. An individual carrying out a small scale business may also want to purchase new or leased retail space, inventory, machinery, equipment or transport vehicle.
Cash Credit is given for commercial purposes. This is not a type of retail loan.
If the loan is for daily operations, it's an operating expense. If it's for long-term assets like real estate or equipment, it's a capital expenditure. If it's managing existing debts, it falls under debt service.
The main types of loans include personal loans, home loans, student loans, auto loans and more. Each loan type is used for a different purpose and typically has different repayment terms and qualifying requirements.
A personal loan is a type of loan that allows you to borrow a certain amount of money from a lender, like Huntington, to fund a major personal expense, like medical bills, a home renovation, an emergency expense, and more.
Key Differences Between Retail Loan and Personal Loan
Purpose: Retail loans are typically used for purchasing specific consumer goods or services, such as vehicles or electronics, while personal loans can be used for a wide variety of personal financial needs.
Traditional vehicle financing involves borrowing money from a bank or other lender. In contrast, a retail installment sales agreement is when you borrow directly from the auto dealer. These dealers typically sell the retail installment sales contract to a bank, credit union or other lender.
Retail lending is a broad term that spans all loans and credit that banks offer to individual consumers. In the case of mortgages, retail lenders offer personal mortgages to help people buy their homes. Both banks and credit unions are retail lenders.
A retail loan is one that a bank gives to a natural person, whether or not it is secured or intended for a particular use; it excludes credit card facilities, current account overdrafts, and loans to individuals for starting their own businesses.
Banks, credit unions, savings and loan institutions, and mortgage bankers are popular examples of retail lenders.
Unlike corporate or wholesale loans, which are meant for businesses and institutions, a retail loan caters to personal consumption or needs. Lenders offer this loan based on your credit profile, income, and repayment capacity.
Seven common types of loans include Personal Loans, Auto Loans, Student Loans, Mortgage Loans, Home Equity Loans, Payday Loans, and Debt Consolidation Loans, each serving different financial needs, from major purchases like cars and homes to consolidating debt or managing unexpected expenses.
TYPE 3 LOAN means any residential mortgage loan originated and serviced by Borrower in accordance with the Seller's Guide, which mortgage loan has a loan-to-value ratio greater than 125% but less than 135%.
A $20,000 loan over 5 years (60 months) costs roughly $2,600 to over $7,000 in interest, with monthly payments varying significantly by Annual Percentage Rate (APR), such as around $377 at 5% APR or $445 at 12% APR, meaning total repayment could range from approximately $22,600 to over $26,700.
What Are the 5 Most Common Loan Types? As a loan officer, five of the most common loan types you'll handle are as follows: mortgages, seed or working capital for small businesses, automotive loans, school loans, and personal loans.
To figure out what type of federal loan you have, look at the promissory note and application, or log into your account on studentaid.gov. You can also look at the top of your monthly bill – the name of the program should be listed there.
Loans can be classified further into secured and unsecured, open-end and closed-end, and conventional types.
Plan 2 loans are those taken out for undergraduate courses and Postgraduate Certificates of Education (PGCE) since 1 September 2012 in Wales and between 1 September 2012 and 31 July 2023 in England. Postgraduate/plan 3 loans are those taken out for master's or doctoral courses by borrowers in England and Wales.
Stage 3 loans which are in cure period. Quantitative indicator: i. Past due more than 90 days and up to 120 days.