Tag Archive | “compound interest”

How would you define a Term Loan?

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A monetary loan that has to be repaid in regular payments over a set period of time is referred to as a term loan. Usually the term loans last between one and ten years, but there are such term loans also that may last as long as 30 years. An unfixed interest rate is usually involved in a term loan that will add additional balance to be repaid.

short-term-money-loan

Who can have a Term Loan?

Individuals can also have a term loan but they are usually used for small business loans. It is an attractive loan for new or expanding enterprises, as they have huge time to repay the loan amount and it is assumed that they will increase their profit over time.

For raising a business’ supply capabilities or range, term loans are a good way of increasing capital in a short span of time. For example, term loan might be used by some new companies for the purpose of buying company vehicles or rent more space for their operations.

Some Students Loans are also Term Loans

There are some student loans that are also term loans. In the United States, the Stafford Loan is the name given to a loan that is usually offered to college students as a means of paying tuition and living expenses. This loan can be very beneficial to students.

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September 2011
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