An individual or institution that lends money, ie extends credit, to another. The person who is taking the money is the debtor.
There are two types of credits:
- Personal - loans made to friends or family
- Real - loans made through contracts and by established entities. Here the creditor has the right to claim the debtors assets.
Secured loans allow creditors such as banks to take the collateral. Unsecured loans enable the creditor to take the debtors to court as in the case of credit card debt.