installment loan

American  

[in-stawl-muhnt lohn] / ɪnˈstɔl mənt ˌloʊn /

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.

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Etymology

Origin of installment loan

First recorded in 1920–25

Example Sentences

The installment loan product allows customers to break up the cost of larger purchases into several fixed monthly payments, typically over a longer span than Klarna’s interest-free options.

From Barron's • Nov. 18, 2025

Answer: A car loan might boost your scores, especially if you don’t already have an installment loan such as a mortgage on your credit reports.

From Los Angeles Times • May 11, 2025

But you’re right, your score will take a small hit because you’ll no longer have an installment loan open and will be left with just a credit card.

From Slate • Feb. 3, 2023

Consumer Financial Protection Bureau: What is a personal installment loan?

From Seattle Times • Jan. 10, 2023

Some lenders suspend payments temporarily, while others may require that the installment loan be paid as agreed, until the inquiry concludes.

From New York Times • Dec. 29, 2022