What is a loan term?
Loan term: A loan term is the length of time you have to repay a loan, usually stated in months. It affects both your monthly payment and the total interest you pay.
A longer term spreads repayment over more months, which lowers each payment but usually increases the total interest paid. A shorter term raises the monthly payment but typically costs less overall.
Personal loan terms commonly range from one to seven years, depending on the lender and the amount. Home equity and business loans can have different term structures.
When you compare offers
Compare offers on the same term when you can, and check that the monthly payment fits your budget for the full length of the loan.
Related guides
- Comparing Offers: APR, Fees and Term
A plain-language guide to the three numbers that matter most when comparing loan or credit offers — APR, fees and term length.
- What to Check Before Comparing Personal Loan Offers
A checklist of what to have ready before comparing personal loan offers, plus how prequalifying with Lendara is designed to use a soft pull.
This glossary is for general educational purposes and isn't financial, legal or insurance advice. Lendara is not a lender and does not make credit decisions. Lendara is a free online marketplace that connects you with participating lenders and providers, who set their own eligibility rules, rates, fees and terms. Lendara may receive compensation from partners, which may affect which offers appear and their order.