With a good use of credit, a significant number of situations in the personal, family and business economy of these times can be resolved. A misuse of credit can lead us to have an economic problem. The loan is therefore useful and the problems are caused by us, when we make an inappropriate use such as: contracting a debt greater than our ability to pay.
The loans can be for individuals or natural persons or for companies or legal entities. In order to borrow properly, it is important to take the credit indicated for our case, for example, knowing exactly the amounts of principal and interest payments. A Promissory Note is a one-year loan, which requires quarterly payments of 25% of the capital, it is very likely that this type of instrument is not suitable for a natural person and it would be better for him to look for a loan by installments, let's say for example to three years.
Loans for natural persons are generally consumer loans (purchase of vehicles or credit cards). You can also go into debt to start a business or purchase an asset. The credits can be short, medium and long term, look for the option that suits you best and remember that you should not go into debt if you have doubts or do not exactly understand the obligations you assume.
It is evident that the recommendation that we are going to give you is that you should get into debt with the bank of your choice, but always go to formal markets, if you go to lenders, you will pay usury rates, hence the importance of being banked, it is in other words, working with banks, not only when applying for loans, but also when entrusting their savings.
Do not place money in institutions, companies or with persons other than banks or regulated and supervised institutions. Another aspect of interest when borrowing is that the rates are attractive, even the highest credit cards that are at 29%, since all rates are below inflation, it is therefore a good opportunity to borrow and buy an asset or make an investment. If you also qualify for an activity that has regulated rates such as agriculture, tourism, manufacturing or housing, the recommendation to borrow is stronger. It is a good business to borrow, as long as you have the ability to pay.
In the case of companies, I am going to refer to the main modalities: They represent the money received from a financial entity and the net credit balance of the current accounts held in the bank books. Bank loans are requested for different reasons, among which the following can be mentioned: (1) financing of working capital; (2) purchase of inventories; (3) acquisition of fixed assets; (4) cancellation of debts.
A loan is received for working capital financing, when a company requires cash to pay off short-term debts or to acquire some asset that is quickly realizable. When this type of financing is requested, there must be reasonable security in obtaining sources of income for the cancellation of the debt.
The second option for which a loan may be required from a financial institution is for the purchase of inventories, which are goods that are made in the short term. The third reason is the acquisition of fixed assets, which is intended to take on a debt that will be invested in the acquisition of a long-term asset that must be used to generate operating income.
A loan can also be taken for the cancellation of debts, in which case the structure of the liability does not undergo any modification or alteration since the money received will be applied in the reduction of another liability, that is, there is an exchange of values ??between items of the same nature.