Loans

This chapter describes different types of loans that customers take from banks. Mortgage loan is a loan to an individual using a property as security for the repayment of the loan cash flows. Consumer loan is another loan to an individual, not a mortgage loan but still with a specific purpose. Student loan is a loan proposed to students to assist them in the payment of the costs of education. Consumer loans credit duration is often low since the value of the financed product amortizes very fast. Mortgages loans duration can be higher, up to 50 years in some countries. More generally, credits are often amortized since the value of the financed product decreases with time. Leasing contracts give to the client the enjoyment of a material good without the immobilization of the cash. The lender retains the ownership of the good. The customer pays a fixed or a floating sum that could be a fixed or as an indexed amortizing. At the end of the contract, the customer has sometimes the opportunity to buy back the material good or to sign a new contract.