Borrowing Sources
If you decide you can afford to borrow money for a significant one-time expense, you have many borrowing sources you can choose from.
When it comes to financial institutions, you can borrow from retail banks and savings banks, credit unions, consumer finance companies as well as insurance companies.
Other borrowing sources include credit card companies, a popular one (though many may not realize it) that we describe in far more detail in the Credit Cards lesson. Some retirement funds permit borrowing but that can be a risky choice and is explained in Investopedia’s Borrowing From Your Plan.
You can also borrow from the U.S. government, which lends to students and their parents for education, and to farmers to assist them. Check out GovLoans.gov for more information.
Of course, you can also seek loans from family or friends, who may or may not offer you better terms.
- Bank
- Retirement fund
- Both bank and retirement fund
CORRECT!
The Correct Answer is:
Both bank and retirement fund
- True
- False
CORRECT!
The Correct Answer is:
True
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BORROW: Lesson Highlights
- Understand when to borrow--and when not to.
- What to grasp before you take out a loan: Principal, interest, late fees.
- Lenders and loan options.
- A special case: credit cards.
- What a credit score is and what it means to you.