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There is a catch however. The more you hold it, the more the price grows I believe. If you want to take another loan, you won't be able to until you repay the old one.
I personally see the loaning feature quite useless, considering I have around 12000 gold by the time I get to the Bloody Baron and now I'm sitting at 110k gold.
Without the expansions, there is not really a real gold sinker in the game. The enchanter in Heart of Stone takes 40k gold and I still haven't played Blood and Wine, but there could be even more than 40k gold to renovate the house.
I personally don't think anyone had that much cash by the time they get to the baron. i rarely had over 1000 crowns until i was halfway done with novigrad.