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In finance, a loan is the lending of money from one individual, organization or entity to another individual, organization or entity. In finance, a loan is the lending of money from one individual, organization or entity to another individual, organi...

In finance, a loan is the lending of money from one individual, organization or entity to another individual, organization or entity. In finance, a loan is the lending of money from one individual, organization or entity to another individual, organization or entity. A loan is a debt provided by an entity (organization or individual) to another entity at an interest rate, and evidenced by a promissory note which specifies, among other things, the principal amount of money borrowed, the interest rate the lender is charging, and date of repayment. A loan entails the reallocation of the subject asset(s) for a period of time, between the lender and the borrower.In a loan, the borrower initially receives or borrows an amount of money, called the principal, from the lender, and is obligated to pay back or repay an equal amount of money to the lender at a later time.