What is Loan – credit
Section 17: Loans This section will show you how mymemoney deals with funds. Detailed explanations on loans and local and fee details can be found in other sources of information. A loan is an arrangement whereby a borrower receives funds from a lender and undertakes to reimburse the money at a later date.
With mymemoney, you can track loans, where you are the lender and lending, or where you have borrowed as a borrower. Many individuals have borrowed money rather than lending money to them so they are usually the borrower and a lender’s financial institution.
Of course, if you give a loan to a family member or acquaintance, you can also check this loan with mymemoney. We assume in this statement that you are borrowing money from a financial institution, but the remarks above refer to a loan that you grant to someone as a lender.
The main difference between borrowing and borrowing is that you use a savings category to manage a borrowed loan and an income category to borrow.
This is the case when borrowing. Basic principles of a loan. The amount taken in is called the “loan amount” or “loan debt”. Execution time. The period in which the loan is concluded is referred to as the “term” of the loan.
At the end of the loan period, the entire loan amount is repaid to the lender. The payment terms are usually set in calendar weeks, calendar months or years. However, a credit period can also be determined by a series of payment transactions. An annual loan with weekly repayment can be termed either a one-year loan or a 52-repayment loan.
Amortization. As a rule, the payment of the loan amount to the lender does not take place in each case in an amount.
Rather, there will be a series of payment transactions, each with a portion of the credit debt. Such repayments are sometimes referred to as “repayments”, and in mymemoney, the term “loan repayment” is used to repay a loan. The installment is the one.
The repayment cycle in mymemoney is called the “payment rhythm”, such as weekly, 2-week, monthly, quarterly, or year. Domestically, regular monthly payments are usually made so that the payment cycle of the loans is one calendar month. The borrower pays the lender a fee called “interest” for the possibility of borrowing.
The interest is usually paid as a percentage of the loan amount over the fixed period. The interest rate may be fixed and not change during the term of the loan, or it may vary and change during the term of the loan. Regular repayments. Because repayments are usually made on a regular basis, such as once a week, once a month, once a quarter, or once a year, they are referred to as “periodic repayments.”
The loan amount plus interest results from the total of all regular repayments plus the final installment. Fees. It is possible that additional fees have been set, to be included in each withdrawal. This is called “repetitive cost”. Example of recurring fees (but not limited to): “pledge” or “escrow account payments”.
Such expenditures are usually used for the safekeeping of funds and the payment of annual or biennial taxes. To summarize, at the beginning of the loan, the borrower has received a lump sum from the lender. The borrower makes a regular payment to the lender. The recurring amount is the amount of the principal repayment (which serves to repay the loan), the interest rates (which reward the lender for lending) and other regular fees (which cover other incidental expenses).
The borrower repaid the entire amount at the end of the loan.