Installment Loans

Installment loan pages explain closed-end borrowing such as auto loans, personal loans, and other credit products repaid through scheduled installments. These pages focus on payment structure, payoff shape, and the way installment debt differs from revolving balances.

Readers should start here when they need a clean explanation of fixed-term borrowing rather than open-ended credit.

Start Here

• Installment Loan

In this section

• Installment Loan
  An installment loan is a closed-end loan repaid through scheduled payments over a defined term.
• Personal Loan
  A personal loan is an installment loan borrowed for general consumer use rather than for one narrowly restricted purchase.
• Auto Loan
  An auto loan is an installment loan used to finance a vehicle purchase and repaid over a defined term.
• Student Loan
  A student loan is an installment-based education borrowing obligation used to help pay eligible schooling costs.
• Origination Fee
  An origination fee is a charge for making or setting up a loan.
• Loan Term
  A loan term is the length of time the borrower is expected to take to repay a loan under the agreement.
• Amortization
  Amortization is the process by which scheduled loan payments gradually reduce principal over time.
• Principal
  Principal is the core amount borrowed or still owed before adding the cost of interest.
• Fixed Payment
  A fixed payment is a scheduled loan payment that stays the same amount throughout the loan term under normal conditions.
• Interest Rate
  An interest rate is the pricing percentage used to calculate the cost of borrowing a loan balance over time.
• Monthly Payment
  A monthly payment is the scheduled amount a borrower must pay each month on an installment loan.