Understanding Deferred Payments

Any arrangement where you get "stuff" (money, goods, services), and agree to pay for it in the future

An agreement where you get a fixed amount of money and pay it back over a period of time, usually with interest

The percentage charged for the privilege of borrowing money

The amount you borrow

The amount of time you have to repay your principal

Something valuable that the lender can take as payment if you can't pay back your loan (like a house or car)

Someone who legally agrees to take responsibility for a person's debt if they cannot repay it

Debt tied to a specific tangible asset that can be used as collateral and reposed if payments are no made

Debt NOT tied to a specific asset or that cannot be repossessed if payments are not made

Interest rate can CHANGE, based on prime rate or index rate, over the course of the loan