ABSTRACT
This chapter deals with the basics of loans and mortgage loans. Particular attention is paid to mortgage loans, as many people are involved with these. Loans with constant repayments and constant total payments are explained. Depending on the repayment schedule, various forms of loans can be distinguished, namely loans with one repayment, loans with constant periodic repayments, and loans with constant payments for the total of interest and repayment. Loans with constant repayments have the same repayment in each year, but the interest payments decrease over time, as the principal becomes smaller. When a real estate property is bought, part of the purchase price is usually financed by a mortgage loan. This is a loan in which the real estate property serves as a security for the repayment of the loan and the payment of the interest. The term of a mortgage loan is the period for which the interest rate is negotiated.
