Getting a loan can be frustrating. It helps to know a little bit about the types of loans that are most popular. Knowing about what is available will help you make a more informed decision. The bottom line about loans is to make sure you absolutely need them because in the end you have to pay them back.

The most popular loan type is a car loan. Car loans can come from many sources and are probably the easiest for someone with poor credit to get. The main purpose for a car loan is to buy a car. You borrow the amount to pay off the car and then make fixed payments for a fixed period of time. Interest charges and other fees may be applied depending on the lender.

Home loans or mortgages are used to buy a home or make repairs to a home. There are two types of home loans- conventional and government. Conventional loans follow certain terms and conditions set by the lender. They include interest rates and other fees. They can have a fixed or variable rate. Fixed rates mean your payments are the same amount for the life of the loan. Variable means your payments change with changes in the interest rate. Government loans include, FHA(Federal Housing Administration), VA(Veterans Affairs), and RHS (Rural Housing Service) loans and loans offered through state or local agencies. These loans are usually income based and can provide help with down payments and negotiating interest rates.

The next popular loan type are student loans. Student loans are used to pay for education. These loans can be private or federal. Private loans are credit based and come from conventional sources like banks. The Federal Stafford loan is a government type loan that has three different types. The subsided loan type is based on need, has a variable rate and is paid back starting six months after graduation. The unsubsidized loan type is not need based, has a variable rate and is paid back starting six months after graduation. The last type of Stafford loan is the PLUS or parent loan for undergraduate students. This loan is made to parents and they can borrow as much as needed. It is not based on need or income.

These three types of loans - car, home and student- are the most popular types of loans people obtain. They all are used for a specific purpose. While they vary in how to obtain them and how they work they all are examples of general loan types.

• Most any large city has a number of small shops offering payday loans. They’re often found in strip centers; sometimes they double as pawn shops. They have a simple business – they lend you money until your next paycheck. The system is pretty convenient; you write them a postdated check for the amount you’re borrowing plus interest. On your next payday, they cash the check and your loan is paid off. What many people who use payday loan services fail to realize is that the interest rates charged by these firms are substantial, often reaching the equivalent of four hundred percent per year!
  
  
• To get a secured loan it can take time for loan approval, as the property will be inspected and appraised. Unsecured loans such as credit cards are usually faster to acquire, however the loan approval time may include a credit check. A credit check involves a lender getting a copy of your credit report to inspect your credit history.
  
  
• Credit card balance transfers
  
  
• All kind of loan – educational loans, auto loans, secured loans, unsecured loans, personal loans and any kind of loans – can be consolidated under debt consolidation mortgage. It is highly appropriate to adopt debt consolidation mortgage if you have numerous debts. However, a prudent step will be to understand debt consolidation if you actually want to apply for it. Debt consolidation mortgage has the capability to be turned in a way so as to allow maximum monetary benefits. Yet, one little error with debt consolidation mortgage and your situation will be back to square one.