Definition
Lender
A lender is an individual or institution that gives money to a borrower with the expectation of repayment, usually with interest, under agreed-upon terms.
A lender gives money to a borrower with the agreement that it will be paid back within a certain time.
While people often think of lenders as banks, many other types of lending organizations exist including:
- Payday lenders
- Leasing companies
- Trust companies
- Credit card companies
- Home equity banks
- Private equity firms
- Development banks
- Family trusts
- Provincial agencies
- Municipal agencies
- Retailers
- Utility companies
- Equipment companies
- Auto companies
- Trade vendors/suppliers
- Individuals
A lender must always be repaid for a loan. If payments are not made as agreed, the lender can use the legal system to recover its money.