Long-term loans are loans that have a longer tenure or repayment period. The repayment period can range anywhere from a year to 30 years on an easy loan app. Usually, loans paid off in more than three years are considered long-term loans. Most of these loans cater to borrowers belonging to different economic segments of society. They help resolve diverse financial needs and can repay in small installments or EMIs without causing any trouble to the borrower. In addition, such loans allow you to enjoy maximum benefits from schemes offered by various private and public sector banks.
One can meet various financial needs and get instant cash with such loans, including weddings, home renovations, education, vacations, car purchases, or other personal or commercial purposes.
Long-term online loans are available across nearly all categories of debt solutions. Based on their tenure and purpose, here’s a look at these loans across different debt segments:
- Home Loans:
It can be considered the most appropriate example of long-term loans. The tenure of home loans goes up to 15 to 20 years and, in some cases, even 30 years. Here, the house or apartment is security until the loan pays off. The extended repayment tenure is usually due to the high loan amount. These loans sanction for an amount ranging from about Rs. One lakh to Rs. Three crores. Because of the increased loan amount, the borrowers can opt for a sufficiently long repayment period to have reasonable EMIs. As a result, the chances of default reduce to a minimum level.
- Education Loans:
These are the loans offered to students. The loan covers the applicant’s tuition fee and other necessary expenses required. After completing their studies, students can find employment and repay the loan.
The repayment period of such loans is usually higher in medical and engineering students as the tenure of such courses is already long. In addition, these loans offer national and international study programs depending on the applicant’s requirements. The loan amount is higher for engineering and medical students due to the high cost of studies and the better chances of finding a job in these fields. Nonetheless, students and guardians should note that the given amount of loan and interest rate usually depends on the lender’s policy. Some banks may offer higher loans even for regular programs if it is well-known.
- Vehicle Loans:
These loans provide for purchasing cars and two-wheelers. Car loans have seen a massive demand in the last few years due to a significant increase in applicants and borrowers in the previous decade. It is because of growing purchasing power and improvement in the lifestyle standards of people. One can put this loan in the long-term loan category as car loans with amounts as high as Rs. ten lakhs or more require repayment for at least three years. Cars are considered a luxury; thus, their interest rates are usually higher than other loans. However, increased competition in this sector has pushed banks to lower their interest rates and increase their tenure. The typical term of a car loan can be up to seven years which is pretty sufficient for a borrower to repay in easy installments.