Loans

Tags

finance

A quick [see page 9, investment] which needs to be re-payed, often at a high interest rate.

We normally call the original amount of sum borrowed the principal.

Loans will often require a security (eg. your house, or other long term investment).

A term loan is a loan offered by banks that fixes an amount time period repayment terms and interest rates are negotiated and repayed.

A loan-note/bond (eg. Eurobonds) represents a promise to pay a certain amount of money at a certain maturity date + a certain interest rate on the initial input. Bonds can redeemable meaning the bond owners can repay it in advance if they want. Secure bonds are bonds backed by some sort of security/collateral. Bonds owned by LLC are often listed on the stock exchange, and some bonds can be convertible meaning you can trade them for another currency (eg. stocks).

Mortgages are a long term form of loan that is secured on an asset (often land/property). Banks grant mortgages over 20 or more years.