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What then is a consumer loan and how is it different from a personal loan?

ersonal loan. The only difference is that a consumer loan is given against some specific consumer durable, like a television or a stereo system. Let's say you want to buy a washing machine on a loan - the finance company or bank would provide you up to 85% of the cost, you would have to chip in the rest! How much you actually get will depend on the product you're going in for.

On personal computers, for example, most banks offer only up to 70% while they will give you up to 90% for a television. However, remember that the product you buy will remain hypothecated to the financier till you repay the loan. For all other purposes you would be considered the owner. So if someone messes around with your TV or damages it in any way, you and not the bank would have to pay for fixing it!

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