Loan

A loan is money that is borrowed and must be paid back, usually with interest. In simple terms, a loan lets someone use money now and repay it later. Loans are important because they help people, businesses, and governments pay for large expenses, such as homes, cars, education, equipment, or business growth. However, loans also create repayment obligations, so borrowers need to understand the interest rate, payment schedule, and total cost. For example, if a person borrows $20,000 from a bank to buy a car, that money is a loan, and the person must repay it over time. A loan is not free money. It usually has to be repaid with interest, which means the borrower pays back more than the original amount borrowed.