Loans agreed with a lender over a set period of time of less than a year, are classed as short-term debt. While loans agreed on for more than a year are classed as long-term debt. For example, a mortgage is a long-term debt as it can take up to 40 years to repay.
Here are some examples of short- and long-term debt:
Short-term debts |
Council Tax |
Mobile phone contract |
Current account |
Utility bills |
Credit card |
Bank default agreement |
Hire purchase |
Insurance agreement |
Mail order account |
Long-term debts |
Consolidated debt |
Fixed-term agreement |
Uncategorised agreement |
Secured loan |
Unsecured loan |
Mortgage |