![]() ![]() What Type of Loan is It? Even-Payment? Or Straight-Line? I’ll cover floating rate loans at another time. I’m going to assume that the interest rate is fixed. Is the Loan’s Interest Rate Fixed or Floating? Investopedia: A loan from a bank for a specific amount that has a specified repayment schedule and a fixed or floating interest rate.Ģ.Term loans usually last between one and ten years, but may last as long as 30 years in some cases. Wikipedia: A monetary loan that is repaid in regular payments over a set period of time. ![]() Term loans are generally provided as working capital for acquiring income producing assets (machinery, equipment, inventory) that generate the cash flows for repayment of the loan. ![]() Business Dictionary: Asset based short-term (usually for one to five years) loan payable in a fixed number of equal installments over the term of the loan.For example, here’s how different sources define a term loan: ![]() This is an interesting question because it touches on at least four issues related to the time value of money: 1. “How do I calculate cumulative principal and interest for term loans? I have scoured the web for a function that will perform this task, with no avail. ![]()
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