Debt

A debt is an amount of money borrowed by one party — i.e., person, company, etc. — from another. Many individuals and companies use debt as a method for making large purchases that they could not afford under normal circumstances. A debt arrangement gives the borrowing party permission to borrow money under the condition that it is to be paid back at a later date, usually with interest.

Examples of common debts include:

• Mortgage
• Credit card debt
• Personal loan
• Student loan
• Car loan