Loans refer to money redistribution between a borrower and a lender. As a borrower, you will be given by the lender a sum of money that you will pay back later. Normally, this kind of service is offered at a cost known as annual percentage rate or interest.

Some good examples are installments and credit card lines, which are repaid in monthly payment within a given time. This includes the finance charge and interest. Furniture, computers, home appliances and cars are just some of the things that can be purchased through installment loans.

A credit card is an example of a loans for people with bad credit that is unsecured by collateral. Unsecured type of debts has higher interest rates but can be risky for the lender as no collateral is involved. Home equity credit lines, car loan, mortgage loan, payday loan and student loan are just some of the different types of loans. Acting as a loan provider is one of the chief tasks of some financial institutions. For others, debt contract issuance like bonds is a usual source of funding.