What are the different types of loans in 2024?

Different types of loan in 2024

Taking out a loan for a variety of financial requirements without knowing about the various types can lead to difficulties. A few things you should know before applying for a loan. 

So, there are multiple types of loans for different requirements. Before taking out a loan, you should determine which type of loan is most suitable for your financial demands. In this blog, will see different types of loans and What to consider with different types of loans. 

Different Types of loans: 

Loan type Purpose Loan length Credit check Collateral required 
Personal loan A wide range of personal expenses, from home improvement to vacations 12 to 84 months (about 7 years) Yes Sometimes 
Debt consolidation loan Combining debts from various sources into one loan 12 to 84 months (about 7 years) Yes No 
Home loan To buy new property and home construction Five to 30 years Yes Yes 
Student loan To pay for a post-secondary education five to 15 years Yes No 
Auto loan To finance a vehicle 12 to 84 months (about 7 years) Yes Yes 
Medical Loan To fund your Medical Emergency Up to 300 months (about 25 years) Yes Yes 

Personal Loan: 

Personal loans are unsecured loans. It allows you to borrow money from a bank or lender, which you can then use for a variety of objectives like organizing a trip, doing business, or planning your dream wedding.  

However, the borrowed funds must be repaid with additional interest charged by the lender. Because it is an unsecured loan, the lender will not take away your things if you fail to make your loan payments, but it may have a bad impact on your credit score.

Debt consolidation loan: 

If an individual has multiple debts and wants to pay them off faster, a debt consolidation loan is a preferable option. It allows borrowers to pay off their debts faster and makes monthly payments easier. 

Since it, unsecure debt consolidation loans come with high interest rates. It can be useful to pay your credit card bills medical emergencies, and others. 

Home Loan: 

A home loan is also referred to as a mortgage loan. It is a type of secured loan that allows individuals to finance the purchase of a property, where the property being purchased serves as collateral.  

Since it is a secured loan, you can typically borrow a loan-to-value ratio of up to 85%, which means you can take up to 85 % of the home’s value. However, the percentage can vary between lenders or any financial institution. 

Student loan: 

Student loans are a type of financial aid that helps individuals finance their educational expenses, such as tuition, fees, room and board, and other related costs. These loans are designed to make higher education more accessible and affordable for students and their families. 

Types of Student Loans: 

Criteria Education Loan Student Credit Card Smart Education Loan 
Loan/Credit Type Term Loan Revolving Credit Term Loan 
Interest Rate Fixed or Floating Revolving Credit Interest Rate Fixed 
Loan Amount Up to the full cost of education Typically lower limits Up to the full cost of education 
Repayment Period Starts after course completion or 6-12 month grace period Pay minimum amount due monthly Starts after course completion or 6-12 month grace period 
Security/Collateral Typically requires collateral or co-applicant No collateral required No collateral required 
Eligibility Students, job seekers, employed Students Students 
Tax Benefits Interest paid is tax-deductible No tax benefits Interest paid is tax-deductible 

Auto loan: 

An auto loan is a type of loan offered to buy a new or used vehicle like a car, bike, or truck. Usually auto loans come with fixed-rate repayment and loan tenure ranging from 12 to 84 months (about 7 years). 

Usually, auto loans are secured by the vehicle you are purchasing, which acts as your collateral. Banks and other financial institutions offer unsecured car loans for people with excellent credit scores. 

Medical loans: 

Medical funds are unexpected financial needs, and it is necessary to cover your hospital bills, treatments, and medication. 

These expenses can be managed by maintaining a good credit score. Borrowers can acquire an immediate medical loan from the lender if they maintain excellent credit. 


What are the types of secured loans? 

A loan comes with collateral and are secured loans such as home loan, vehicle loan and secured credit cards. 

What is a secured and unsecured loan? 

Secure loans have collateral, which means they are protected by something you own that the lender may seize if you fail to repay the loan. Unsecured loans always come with no collateral. 

What type of loan is cheapest? 

Secure loans can be considered an affordable choice because they have collateral and a low interest rate. 

How to get a loan with no credit? 

Yes, Zap Money offers immediate personal loans up to 3000 for people with no credit by simply installing the Zap Money app on the Play Store and registering it. 

What is an unsecured loan example? 

Unsecure loans come with no collateral such as student loan, personal loan and credit cards are example for unsecured loans 

Hariharan Ravichandran

Understanding the ever-changing environment of money may be a difficult experience.I'm Hariharan, a seasoned finance explorer and blogger. I am right there with you, beginning on this journey of financial enlightenment as a fellow traveler.


The ZapMoney app makes personal finance easy, accessible, and affordable. The App is available on Google Play Store and App Store for download, allowing you to sign up and access easy personal loans. ZapMoney is powered by Monexo Fintech Private Limited which is a registered NBFC-P2P.
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