Glossary
The smallest amount a borrower must pay each month to keep an account in good standing. Common with revolving credit like credit cards.
In depth
Paying only the minimum on revolving debt can take years to pay off the balance and results in significant interest charges. Personal installment loans differ — each fixed payment is designed to fully pay off the loan by the end of the term, with no "minimum payment" trap. Harbor Lenders works with participating lenders that offer fixed-payment installment loans for predictable payoff.
FAQs
Personal installment loans have fixed monthly payments that are set to pay off the loan by the end of the term. There is no open-ended minimum like a credit card — each payment moves you closer to a zero balance.
You will incur substantial interest over time and the payoff timeline can stretch to many years. Using a personal loan to consolidate credit card debt replaces revolving minimums with a fixed payoff schedule.
Related terms
Installment Loan
A loan repaid in fixed, regular payments over a set period. Each payment typically covers both principal and interest, and the loan is fully paid off at the end of the term.
Read more →Loan Amortization
The process of spreading loan payments across the loan term, with each payment covering both interest and principal. Early payments are interest-heavy; later payments shift toward principal.
Read more →Debt-to-Income Ratio (DTI)
The percentage of your gross monthly income that goes toward monthly debt payments. Lenders use DTI alongside credit score to assess repayment ability.
Read more →Personal Loan
An unsecured installment loan that can be used for almost any purpose. Repaid in fixed monthly payments over a set term.
Read more →One secure request. No hard credit pull. No cost to check.