The often confusing world of financing

The Often Confusing World of Financing The world of financing can be really confusing, especially if you are new to the scene. There are lots of terms that are not always clear and the paperwork alone can be a little overwhelming. Let us see if we can clear up some of this confusion and boost your confidence a bit at the same time.

First things first, what exactly is financing in the first place? Financing is the broad term applied to all of the different types of loans and lines of credit you can apply for – car loan falls under financing, house loan falls under financing, business loan falls under the term financing. You get the idea.

Now, there are a few standard things that go with loans of any kind. First, you have to apply for a loan and qualify to be approved. The type of loan you apply for, the amount you want to borrow, and your credit rating will all be deciding factors on whether you are approved or not and what interest rate you will have on your loan. Interest rates are another commonality among all loans – short-term loans or long-term loans, small business loans or personal loans – all loans have an interest rate attached. The interest rate is a percentage of your loan that goes directly to your lending institution for servicing and carrying your loan until it is paid in full. The interest is also additional to the principal of your loan – the principal is the actual amount you are borrowing, not counting interest or closing fees or anything else. Beyond these things, there are a few differences you should be aware of.

Short-term loans and long-term loans: A long term loan would be something like a house loan that requires 10, 15 or even 30 years to pay off. House loans are the most common type of long-term loan. Short term loans Brisbane, on the other hand, tend to take no more than 12 months to pay off from start to finish. Oftentimes, lines of credit, such as invoice finance Sydney, are short-term loans.

Online application versus traditional application: Applying for loans in the traditional way takes an exorbitant amount of time – first, you have to go to a bank, then you have to fill out miles of paperwork and, after that, it can take up to 4 months to find out if you are approved and to receive your money.

And, that is provided that the first place you apply accepts you. YIKES! Sometimes, a person just cannot wait that long! Applying online for small business loans, cuts your time considerably because there is only one brief form to fill out and approval and delivery generally only take about 24 hours.

Now, that is more like it!

Whether you need a short term loans Brisbane or a line of credit such as invoice finance Sydney, whether you are new to financing or know the ropes, Magnolia Finance can guide you through the process of applying for the right financing with the right terms for your needs.