2.1.4 Loans

In addition to keeping your money in a financial institution, you may also be able to borrow money. Financial institutions lend the money that people deposit and charge interest to the borrowers. Common types of loans are:

To take out a loan from a financial institution, you fill out an application that lets the institution judge whether you are able to pay it back on time, based on criteria that it has defined. If it agrees to lend you money, you have to pay it back with added interest. Usually you have to make a payment every week, every two weeks or every month according to what your loan agreement specifies.

For more about borrowing and the cost of loans, see the Credit and debt management module.

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