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Government loans are type of loans
catered by the government or by it’s subsidiaries and
affiliates such as but not limited to rural banks,
development banks, social
security system, and many
more. Some of government loans are catered to the
public; others are exclusive to its employees and
retirees, and some to the public who are paying monthly
contributions. There are numerous types of government
loans that are offered by these government’s financial
institutions. There are particular kinds of government
loans that other similar financial institutions like the
government’s offers, kinds of loans like personal loans,
multi-purpose loans, housing loans, pension loans and
others.
However, there are government loans that are offered
only through the government’s institutions, like
agricultural loans, military loans, veteran loans,
government retiree loans, and many more. Usually
government loans are offered only to their members. |
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Like in Social Security System, loans offered
by this institution can only be availed by its members,
or those paying their monthly contribution.
Same with Home Development Mutual Fund also
known as PAG-IBIG loan, which also caters to the public
that is paying monthly contributions.
It is very advantageous to loan from a government
institution especially through institutions where a
borrower needs to be a member first. Because being a
member of a certain government institution allows its
members to save their money for future needs. In
addition, they can also avail loans that are offered in
easy installment payments much like borrowing from a
bank. Interest rates of government loans are a lot less
expensive than those offered by non-government
institutions. The primary reason why the government
offers loan to the people is to add income to the
institution and to help the people as well. By providing
loans at minimal interest and longer flexible payment
terms, the borrowers can achieve their dreams easily
with fewer burdens.
The drawback however in availing government is that
sometimes it takes a while to get an approval. Since
many borrowers opt to avail government loans. If the
borrower were willing to wait, then it is not a problem.
On the contrary, government loans catered specially to
its retirees and employees are easy to avail. Basically,
because the institution or the lender agency knows their
borrower already. They already have the record of its
employees, including their salaries and backgrounds.
In totality, as far as interest, availability and
payment terms are considered, availing a government loan
is the best option for people who are budget conscious. |
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