A loan is nothing but a kind of debt that you own, and you must repay. Like other debt, loan also follows the reorganization of assets over some time. This happens between the lender and the borrower. When you take loan, it means that you borrow- generally an amount of money- known as the principal. The lender is the person or organization that lends you this money, and you are obliged to repay this amount to the lender. The time and interest are decided beforehand.

More often than not, the money is paid back in parts, called installments. These are also called partial repayments. If you are going for an annuity, then all the installments would be of an equal amount.
You require satisfying several conditions to get a loan. The cost at which you get the loan is called the interest. This is an incentive for the lender. The lender will grant you the loan because apart from paying the principal amount back, you would also pay interest on it.

When you get a legal loan, all the restrictions and obligations are mentioned in a document called contract, and both parties have to follow it. A contract can place the borrower under extra restraints, called loan covenants. Though loans are mostly monetary in nature, but this is not a rule.
There are many financial institutions that are built up for this purpose- whenever you need a loan, you can contact them. You can also take a loan from an individual, or from banks.

There are 3 basic types of loans:
Secured
Unsecured
Demand

Secured Loan
This is the kind of loan where the buyer places an asset as collateral. This collateral can be a piece of property or car etc.

Unsecured Loan
These loans do not come with any security from the borrower’s side. These are made available by various financial institutes.

Demand Loan
These are short term loans and generally do not extend beyond 180 days. They have floating interest rates. The lending institute can demand a repayment anytime. These loans can be either secured or unsecured.

Staying away from abuses
There are many abuses that can occur to buyers if they are not careful. These types of loans are called predatory lending. You might have heard of the term loan shark- A loan shark is a moneylender who is not authorized to lend money. These people grant loans in such a way that the borrower becomes trapped in the contract.

Businesses generally require loans and they avail these loans from financial institutes. In case you are looking forward to get a loan, you can get it from a credit union, a commercial bank, or some other lending institution like a thrift organization. You need to fill out an application and show a good credit score in order to be considered for a loan. Make sure to check out the interest rates before you apply for the loan.