A loan takes place when a lender, like a traditional bank or online lender, extends a set amount of cash to a borrower. In exchange, the borrower agrees to repay the loan at a specified interest rate over the course of a set loan term. Whether you’re considering a small personal loan or a larger loan to purchase a home or vehicle, understanding what loans are—and how they work—can help you save money and frustration.

In general terms, a loan involves borrowing a lump sum from a lender, and making regular (often monthly) payments until the loan is entirely repaid. Beyond repaying the loan principal, a borrower must pay interest at a set rate as well as any additional lender fees. To understand how loans work, familiarize yourself with some common terms.

If you pay attention to little clues in how people talk about loan terms, you can often tell what someone’s talking about.

If someone’s talking about the “loan term” (singular), they’re usually referring to the term length—how long you have to repay the loan.

If someone’s talking about the “loan terms” (plural), they’re generally talking about all the details that make up your loan, including how much you’ll owe each month, when your payment is due and your annual percentage rate (APR).

It’s always a good idea to save up money before making a large purchase. But in reality, that’s not always possible. That’s especially true for expenses like a college education, a car or a home, or even unexpected emergencies, like medical bills.

When you can’t save money in advance, you can take out a loan. However, you’ll need to understand what type of loan to shop for because there are specific loans for certain purchases.

Here are 16 types of loans that can help you make necessary purchases in your life:

Personal Loans

Auto Loans

Student Loans

Mortgage Loans

Home Equity Loans

Credit-builder Loans

Debt Consolidation Loans

Payday Loans

Small Business Loans

Title Loans

Pawnshop Loans

Boat Loans

Recreational Vehicle (RV) Loans

Family Loans

Land Loans

Pool Loans