An amount of money that is lent by a person or an entity to others (including individuals, entities, etc.) The borrower, or recipient of funds, incurs a debt and is legally liable to repay the loan (its principal amount) in addition to interest (if it is an interest-bearing loan) until it is fully repaid to the lender. Interest is calculated using a number of inputs including, base rate and interest rate (the cost of a loan expressed as a percentage of the loan amount charged by the lender), loan term (maturity), among others.

The two parties to a loan agreement negotiate the terms of the loan before the money is actually advanced.

Loans come in many types depending on the user of loaned money. Examples include mortgage loans, credit card loans, personal finance loans, auto loans, etc. They can also be classified as retail loans, interbank loans, etc. Furthermore, a loan may be secured by collateral (e.g., mortgage loans) or it may be unsecured (e.g., credit card loans).