Installment Loans

Acceleration means the lender demands the full remaining debt sooner than originally scheduled after serious default or contract failure.

Amortization means the process by which scheduled loan payments gradually reduce principal over time.

Auto loan means an installment loan used to finance a vehicle purchase and repaid over a defined term.

Industry-specific score designed to help auto lenders evaluate risk for vehicle-loan decisions.

Balloon payment is a large final payment due at the end of a loan after smaller earlier payments.

Cosigner release is a lender or servicer decision to remove a cosigner from future responsibility on a loan after stated conditions are met.

Credit insurance is optional coverage sold with a loan to help cover payments or balances under specified events such as death, disability, or unemployment.

Small installment product designed to build payment history and credit file depth, often for borrowers with thin or damaged credit.

Deposit-backed loan means a loan supported by money the borrower has on deposit, which helps reduce lender risk.

Upfront amount the borrower pays toward a purchase so less of the price must be financed.

Fixed payment means a scheduled loan payment that stays the same amount throughout the loan term under normal conditions.

Installment contract is the loan or sale-financing agreement that sets the payment, cost, and repayment terms for a closed-end installment obligation.

Installment credit means borrowing repaid through scheduled payments over a defined term rather than through open-ended reusable access.

Installment loan means a closed-end loan repaid through scheduled payments over a defined term.

Installment-loan terms that explain fixed-payment borrowing, payoff schedules, and the structure of closed-end consumer loans.

Interest rate means the pricing percentage used to calculate the cost of borrowing a loan balance over time.

Loan balance is the amount still owed on an installment loan before final payoff adjustments for a specific date.

Loan servicer is the company that manages billing, payment processing, statements, and day-to-day administration after a loan is made.

Loan term means the length of time the borrower is expected to take to repay a loan under the agreement.

Ratio comparing the loan amount with the value of the asset supporting the debt, often used to judge secured-loan risk.

Maturity date is the date the loan is contractually supposed to be fully paid under its payment schedule.

Monthly payment means the scheduled amount a borrower must pay each month on an installment loan.

Situation where the balance tied to secured property is greater than the property's current value.

Origination fee means a charge for making or setting up a loan.

Payment deferral is a temporary agreement that pushes one or more required loan payments to a later time.

Payment schedule is the sequence of required loan payments, including their timing and amounts under the agreement.

Payoff amount is the total amount needed to satisfy a loan in full on a specified date.

Payoff quote is the lender or servicer's provided amount needed to pay a loan off by a stated date.

Per-diem interest is the amount of loan interest that accrues for each additional day before payoff.

Personal loan means an installment loan borrowed for general consumer use rather than for one narrowly restricted purchase.

Precomputed interest is loan interest calculated upfront for the scheduled term rather than recalculated each day on the declining balance.

Prepayment penalty is a charge or built-in cost triggered when a borrower pays a loan off early under the contract terms.

Principal means the core amount borrowed or still owed before adding the cost of interest.

Principal-only payment is an extra payment directed to reduce principal rather than satisfy future scheduled installments.

Refinance means replacing an existing loan with a new loan, usually to change the rate, term, payment, or other major terms.

Secured loan means a loan backed by collateral that gives the lender a stronger claim if the borrower does not repay.

Simple-interest loan is an installment loan where interest generally follows the unpaid principal balance over time.

Student loan means an installment-based education borrowing obligation used to help pay eligible schooling costs.

Total loan cost is the overall amount a borrower expects to pay across the life of a loan, including principal and borrowing costs.