An installment loan is a type of loan that is repaid over time with a set number of scheduled payments. These loans typically have a fixed interest rate and a specific repayment period, which can range from a few months to several years. Common examples include personal loans, auto loans, and mortgages. Borrowers receive a lump sum upfront and then pay it back in regular installments. The main advantage of installment loans is that they provide predictable monthly payments, making budgeting easier for borrowers. However, it's important to consider the total cost of the loan, including interest and fees, before borrowing. Proper management of an installment loan can help improve credit scores and financial stability.