Moratorium Period
A "holiday" from paying EMIs, common in Education Loans. During this time (e.g., course duration + 6 months), simple interest usually accumulates and is added to the principal when repayment starts.
Balloon Payment
A repayment structure where you pay small EMIs initially and a large lump sum (the "balloon") at the end. Common in some business loans.
Collateral
An asset (House, Car, Gold, FD) you pledge to the bank. If you default, the bank seizes the collateral. Loans with collateral (Secured Loans) have lower interest rates.
Guarantor
A person (usually a parent or spouse) who signs the loan agreement with you. If you don't pay, they are legally liable to pay. Being a guarantor affects their own loan eligibility.
Amortization
The process of paying off a debt over time through regular payments. An amortization schedule shows how each payment is split between interest and principal.