2 Thoughts on Loan?bond? what’s the difference?
  1. Reply
    Mat A
    February 5, 2014 at 3:19 pm

    A loan, as in a bank loan or student loan, in which you receive a sum of money that you pay back over time with interest.

    A bond, as in a government bond, is where you loan the government money and after a period of time you are paid back with interest.

  2. Reply
    February 5, 2014 at 4:16 pm

    Actually, there is NO difference. A bond is the document that proves you made a loan to a corporation or government. Think of your mortgage. The bank can sell it to another financial institution in EXACTLY the same way you would sell a bond.

    I don’t like Wikipedia either, so I copied the definition from investordictionary.com

    A long-term debt security issued by corporations and governments offering fixed interest payments periodically for a period of more than one year. Bonds do not represent ownership; rather an investor who buys a bond is actually lending money to the issuer, to help finance current operations and new acquisitions of property, plant or equipment.

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