Definition
A loan that you repay in fixed, regular payments over a set period. Mortgages and car loans are common examples of installment loans.
What to consider
- Research the company thoroughly before investing.
- Consider the volatility typical of new public offerings.
- Review the prospectus to understand the risks and rewards.
Real world scenarios
- Rosa finances her new living room set through a store’s installment plan, paying a consistent amount each month until it’s fully owned.
- Jacob combines smaller debts into a single installment loan at a lower rate, simplifying his finances with one payment.
- Sally’s on-time installments for a personal loan boost her credit, reflecting consistent, reliable repayment.
Related terms
Related Playbooks
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