A bank loan made for a fixed period of time at a fixed interest rate requiring periodic payments of principle and interest is called a:
A)term loan.
B)line of credit.
C)fixed loan.
D)secured loan.

Question

Quizplus · Accepted Answer

A term loan is a type of loan where the borrower receives a lump sum at the beginning of the loan term and repays it in regular installments over a fixed period with a fixed interest rate. This type of loan is typically used for larger expenses such as purchasing a home, a car, or for business loans. A line of credit is different as it provides access to a pool of funds a borrower can draw on as needed but isn't awarded a specific lump sum. Fixed loan and secured loan are both ambiguous terms that do not specifically refer to this type of loan.

A Bank Loan Made for a Fixed Period of Time