Term

Term refers to the time frame during which a loan is expected to be fully paid. It is determined based on the minimum monthly payments, and may be reduced by making additional repayments if the lender allows. The term is agreed upon by the lender and borrower before the loan is granted, along with the other features and provisions. Loan terms depend on the type of loan and the amount of the principal, but may range from six months to five years for personal loans and up to 30 years for home loans.