Glossary
What is Term?
A loan's term is the length of time you have to repay it, from funding to the maturity date. Short-term financing may last a few months to a year or two, while SBA and real estate loans can extend for many years. A longer term usually means lower payments but more total interest paid. Lenders often match the term to the purpose of the loan, such as the useful life of equipment or the nature of a working capital need.
Example
An equipment loan with a 60-month term is repaid in monthly installments over five years.
Related funding
Term Loans: A lump sum with fixed payments for big, planned moves.
Related terms
Questions about an offer? Your advisor will explain every term.