A loan, the borrower initially receives or borrows an amount of money, called the principal, from the lender, and is obligated to pay back or repay an equal amount of money to the lender at a later time. Typically, the money is paid back in regular installments, or partial repayments; in an annuity, each installment is the same amount. The loan is generally provided at a cost, referred to as interest on the debt, which provides an incentive for the lender to engage in the loan. In a legal loan, each of these obligations and restrictions is enforced by contract, which can also place the borrower under additional restrictions known as loan covenants. Although this article focuses on monetary loans, in practice any material object might be lent.

There are many type of loans which the bank is offering to the individuals and to the small entrepreneurs and as well as to the large owners of the companies. There are many types of loans available for the people; some of them are as follows:

	Long-Term Loans
	Short-Term Loans
	UnSecured Credit Lines
	UnSecured Loans
	Secured Loans

The distribution of wealth is totally not equal. The rich becomes richer and the poor becomes poorer. The salary of the individual is not enough for surviving; one has to do a part time job or even should go for loan for meeting the demands of the families. The life of the poor people is becoming very miserable and the rich people are living their lives in a very luxurious manner. The poor and even the middle class family is fighting for the basic needs of the day to day life, because the prices of the products are so expensive that every one is not able to buy the products in an easy way. Mostly people used to borrow money from one another to meet their requirements of day to day, and after sometime return the money back to the lender. So if we see our environment then we can easily say that every one is borrowing money. Bank plays a very important role in providing the loan of different types. The banks play very important role in providing the money to the people so that they can fulfill their day to day routine. One should know very clearly that which cheap loans are good for the person. The individual should know and should very much aware about the updates of cheap loans.

business loan involves a fair amount of planning on the business front and appraisal too. If it is small business start up loan you are looking for, you are required to have a thorough knowledge of the trade, the place you want to start yours from including some knowledge about your competitors. That is a kind of, what they call analysis in their parlance. It is kind of analyzing your strength, weakness, opportunities and threat you expect from the market and your competitors beforehand. People seeking small business start up loans need to work out their documentation error free. It makes sense to draw out a check list of the documents that are required to be submitted along with the loan application. Some of the documents you need to enclose with the applications are:

	Business profile - A definition of your proposed business
	Purpose of the loan - a complete statement
	Personal financial statements - of those with above 20% holdings.
	Separate statements for receivables and payables for 90 days.
	Cash flow prediction.
	Collateral

Loan is a type of transaction in which the borrower gets a certain amount of money from the lender, and the lender gives the money because they both agreed on the thing that the borrower will give the money back to the lender in a certain amount of time period. If the borrowers don't give the money back then it is to be considered as unethical. As we know that education is very important for every one, every one wants to study. The education is not only important for the rich people but also for the poor and middle class people, that's whey the student loan is also there for the anxious students so that they can read and study well, what they want to in a real sense. The best way to utilize the loan is also to pay the loan back in the right time because otherwise the individual has to pay back the money with the more interest rate as it was defined earlier.