As with all types of economic relations, lending requires a subject and object.
Under the subject of the loan is understood thing under which and for which the loan is granted.
The essence of the loan, the loan facilities and entities
Credit - a certain kind of relationship associated with the temporary transfer of funds. It occurs when a purchase is not for cash, but with payment by installments.
The credit relations are always two groups are present - the borrower and the lender, which are the subjects of credit.
As subjects can serve individuals and legal entities, residents and non-residents (foreign companies and entities).
Lenders - this side of the credit relationship,which provides a loan for a fixed period for a pre-specified in the loan agreement conditions. These may include not only banks but also commercial companies kompanii- lombardy- lending to its rabotnikov- individuals who lend notarized.
The borrower - is the other side of creditthe relationship is directly with the recipient of the loan, which refers to the lender to get the loan. These include adult individuals, the appropriate basic set of requirements that vary depending on the lender.
Aside from lenders and borrowers in the number of subjectsCredit intermediaries may be included (eg, brokerage companies, which assist in obtaining a loan) and the guarantor (surety acts as a guarantor of timely repayment of the loan).
Types of credit facilities
Object of the loan can be interpreted in threesenses. In a narrow sense - it is a thing, which is issued under the loan. In a wide - it is not only the thing itself, but also the process that causes the need for credit. So, in this meaning as the credit facility may be a temporary gap in the payment transactions of the company (the need for working capital), when she did not have enough funds for all current payments. The reasons can be very different - it's a seasonal business, and the economic crisis.
In financial terms under the object of credit relations is loan capital.
Loan capital is a set of funds that are available for temporary use on the conditions of their return for a fixed fee as a percentage.
As the credit facility can not actonly money, but also the specific products. For example, when you make a loan to the point of sale, the borrower does not receive the money in his hands, and immediately takes the selected item. It is also applicable in relation to the car loan or mortgage. This type of credit is called the target.
If the credit object is money,they can be given to the borrower in cash or credited to a plastic card. Such loans can be renewed, ie, after the payment of principal on the loan, this amount becomes available again for the borrower. An example of such a loan are credit cards.
Loans may be granted to natural and legalpersons. With regard to credit companies, credit facilities are subject to change. So, in the industry, banks may grant loans for the purchase of raw materials, semi-finished products. For trading companies subject to the loan are often products that are in the turnover. Loans may be made on the credit capital investment - the construction of industrial subjects in its reconstruction, modernization, expansion of production facilities and so forth.
There are two key kinds of credit facility -private, which is issued under a specific object, and the total issued a set of related objects. An example of a private facility - buy apartments, the cumulative - the allocation of the loan for the realization of the business plan, loan funds can be purchased equipment, rented premises, carried out advertising products.