A phrase loan is actually that loan given to company purposes that should be reimbursed within a specified time period. It typically holds an interest that is fixed, month-to-month or quarterly payment routine - and includes a collection maturity date. Term loans could be both protected (in other words. some security is supplied) and unsecured. A secured term loan will usually have a lower rate of interest than an one that is unsecured. Dependant on the payment period this loan kind is classified as underneath:
- Short-term loan: Repayment period less than 12 months.