installment loan

[in-stawl-muhnt lohn]

noun

Finance.

1. a loan that allows someone to borrow a set amount of money and to repay it over a predetermined fixed period of time in regular installments, normally set up by the lender with equal installments that include both interest on the loan plus gradual repayment of the principal.

   They bought their new home and car using installment loans.

Word History and Origins

Origin of installment loan¹

First recorded in 1920–25