Question

Assume S&S Air takes out a bullet loan under the terms described. What are the payments on the loan?

Answer 1

Bullet loans should be contrasted with amortizing loans, where the amount of principal is paid down over the life of the loan.

A bullet loan is a loan where a payment of the entire principal of the loan, and sometimes the principal and interest, is repaid at the end of the loan term.

In bullet loan we can either pay only the interest amount and bulk amount can be paid at the time of the maturity of loan or periodic Interest Payments and lumpsum principal amount at the time of maturity per terms with the financial institution.