Are student loans installment or revolving?
Understand the Problem
The question is asking whether student loans are classified as installment loans or revolving credit. Installment loans are repaid with a fixed number of payments over time, while revolving credit allows the borrower to borrow repeatedly up to a certain limit. Understanding this distinction can help students manage their finances effectively.
Answer
Installment loans
The final answer is that student loans are installment loans.
Answer for screen readers
The final answer is that student loans are installment loans.
More Information
Student loans have a fixed balance and are paid back over time through regular, scheduled payments.
Tips
A common mistake is confusing student loans with revolving credit like credit cards.
Sources
- Is a Student Loan Installment or Revolving Credit? - SoFi - sofi.com
- Are Student Loans Installment or Revolving Credit? - LendEDU - lendedu.com
- Revolving Credit vs. Installment Credit: What's the Difference? - investopedia.com
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