Even today, wanting to provide all the needs and comforts, maybe with a smaller scale than the Habsburg family, wanting to obtain funds, we use several types of bank loans and financing from non-bank institutions. And today it is much easier: we do not have to go on long journeys or hunt to make a deal. We are often separated from cash by “one click” – after all, we can take advantage of online loans.
Let’s go back to our sightseeing for a moment and look at some elements through the loan types.
Types of loans for the palace – mortgage
If you want to own a property, regardless of whether it is our own construction or purchase from the market you will need quite a large amount of funds. At present, the most popular form of financing on the real estate market is a mortgage. It is characterized by the fact that the bank will grant us a loan, provided that collateral for the so-called mortgage. In the absence of repayment, the bank thus has the right to settle claims under a loan from real estate, which is indirectly owned by the bank, until the loan is repaid. Currently, mortgage loans allow you to finance many types of real estate. With the loan, we can finance both a year-round house and a summer property. And let’s remember that Schönbrunn was a summer holiday destination for the imperial family and one of the many residences.
Types of bank loans for imperial apartments – mortgage loan
We can finance the equipment of our property in two ways: both with a mortgage and a mortgage . When applying for a mortgage, we can indicate the value of the property, taking into account the planned renovation and furnishing of the property, thus obtaining financing under this loan product. We can also be owners of real estate that is not mortgaged in any way. Then we can finance its equipment with a mortgage loan. There is one type of loan, where we receive funds from the bank for any purpose, e.g. renovation or repayment of liabilities, and the repayment collateral is the property we own. The value of the mortgage is usually several dozen percent of the value of the property that will be the collateral.
Garden – consumer loan
According to the definition, consumer credit can be used for any purpose related to our current needs, expenses, plans. The bank does not ask us in detail for what and when we want to use the loan – it places the funds at our disposal after conducting a credit analysis using data from the Credit Information Bureau report. The amount of credit we can get depends on our creditworthiness. Probably the imperial family did not have such worries (or history does not mention them), but having a representative property is also worth taking care of its surroundings. Today, we can finance a beautiful garden with any consumer loan. It is also worth remembering that now we can equally quickly and efficiently finance our plans through the use of on-line loans.
Coach house – car loan
Looking to the right from the entrance to the square in front of the palace, we can see buildings that currently house a collection of period carriages and vehicles. To provide funds for our vehicle needs, banks offer a dedicated product – a car loan. Currently, car loans have the criterion of age vehicles, so carriages are unlikely to be financed (remember that consumer loans for any purpose are still described above). Any type of vehicle: car or motorcycle can count on financing from the bank. These loans have a lower interest rate than standard consumer loans. The condition for obtaining a car loan is the mandatory assignment from the AC policy, which is collateral for the bank.
Travel – credit card
We are slowly finishing the tour. Once again, I look at the palace and think about how the carriages with the imperial family and the whole entourage left the courtyard. How did they finance travel then? Probably a few trunks were rich in gold and valuables. Today we have with us a small piece of plastic with a credit limit – credit cards. The card is a type of revolving limit associated with a plastic card that can be paid both in stores and online (it works perfectly when paying for airline tickets or hotel reservations). A credit card is a type of bank loan that is also characterized by so-called “Interest-free period”. This means that if we repay the debt arising from all transactions, e.g. from our travels, the bank will not charge us any additional interest. A credit card is a safe and convenient form of financing not only for travelers.
This short adventure allowed us to learn the basic types of loans on the banking market. By weaving this knowledge into a short trip, we learned about the distribution of loans from the point of view of financing. Like any classification, we can divide it from different points of view: type, subject of financing, loan period, entity applying for a loan. What about treating the whole trip as a visit to an efficient company? We will probably write soon about loans for entrepreneurs.