Term Loan / Equipment Loan
A Term Loan is a secured financing in which the transaction is collateralized by equipment that the company currently owns or is planning to purchase. Term Loans require monthly interest and principal payments. Typically, principal balance will be repaid in full by the end of the term.
In some instances, Term Loans can have balloon payments that are repaid on the maturity date. All the while, the borrower retains ownership of the equipment and the lender is granted a security interest in the equipment for the life of the transaction.