However, there are different subdivisions within these two categories, such as interest loans and balloon loans. It is also possible to sub-note whether the loan is a secured loan or an unsecured loan and whether the interest rate is fixed or variable. A soft loan is a loan made available to the borrower on preferential terms. Often, low-interest loans are loans whose interest rate is lower than the market rate. Soft loans are sometimes referred to as “flexible financing” or “conceding financing”. A revolving facility allows a borrower to deduct money and repay amounts (up to a limit). The sums repaid may be borrowed by a borrower for the duration of the facility. Revolving facilities are similar to fixed-term loans, as they provide a maximum amount that can be borrowed over an agreed period of time, but allows a borrower to recover money such as an overdraft. One of the characteristics used for credit categorization is the number of lenders involved. A loan in which a lender participates is called a “bilateral loan”. A loan in which more than one lender participates can be a “syndicated loan” or a “club loan”.

Multiple lenders may also participate indirectly in the same loan through under-participation. 3. Diversified approaches to syndicated credit. The same credit formulas can include many forms of loans, such as.B. temporary loans, revolving loans, watch-L/C line on the borrower`s requirements. In the meantime, the borrower can also choose RMB, USD, EUR, GBP and other currencies or money wallets if necessary. Bilateral loans and syndicated loans mainly use USD, EUR. RMB, GBP and other currencies are also available. Multiple currencies can be used in a single loan at the request of the borrower. For commercial banks and large financial firms, “credit agreements” are generally not categorized, although credit portfolios are often roughly divided into “personal” and “commercial” credits, while the “commercial” category is then divided into “industrial” and “commercial” credits.

“Industrial” credits are those that depend on the cash flow and solvency of the company and the widgets or services it sells. “Commercial real estate” loans are those that repay loans, but this depends on the rental income paid by tenants who rent land, usually for long periods. There are more detailed categorizations of credit portfolios, but these are always variations around the major themes. A credit agreement is a contract between a borrower and a lender that regulates the mutual commitments of each party. There are many types of credit agreements, including “facilities”, “revolvers”, “fixed-term loans”, “working capital loans”. Credit agreements are documented by a compilation of the various mutual commitments of the parties. . .