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Definition Of Loan:


nThe giving or granting of something, particularly a sum of money, to another, with the expectation that it will be repaid (typically with interest) or returned.
Other definition of Loan- The act of giving money, property or other material goods to aanother party in exchange for future repayment of the principal amount along with interest or other finance charges. A loan may be for a specific, one-time amount or can be available as open-ended credit up to a specified ceiling amount.The terms of a standardized loanare formally presented (usually in writing) to each party in the transaction before any money or property changes hands. If a lender requires any collateral, this will be stipulated in the loan documents as well.Most loans also have legal stipulations regarding the maximum amount of interest that can be charged, as well as other covenants such asthe length of timebefore repayment is required. Loans can come from individuals, corporations, financial institutions and governments. They are a way to grow the overall money supply in an economy as well as open up competition, introduce new products and expand business operations. Loans are a primary source of revenue for many financial institutions such as banks, as well as some retailers through the use of credit facilities.

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