A loan whose principal is not due to be paid back until the loan's term ends and in which only interest is paid periodically during the life of the loan is called a (or an):

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This type of loan is commonly known as a bullet loan, as the repayment of the principal is due in one lump sum at the end of the loan's term, resembling the firing of a bullet. The borrower is only required to make interest payments during the life of the loan, which can have advantages for cash flow management. Working capital loans are typically shorter-term loans used to finance daily business operations, while project loans are designed for specific projects and often have a defined repayment schedule. Interim construction loans provide financing for the construction of a property and are typically repaid through a permanent mortgage once the project is complete.

A Loan Whose Principal Is Not Due to Be Paid