Write a precis of the passage given below in about one-third of its length. Please do not give any title to it.The precis should be written in your own language. 

A loan is a simple concept: Someone gives you money in exchange for your promise to pay it back. The lender could be a bank, friend, family member, or anyone else willing to lend you money. The lender will almost always charge interest, which compensates the lender for the risk that you won’t pay back the loan. Usually, the lender has you sign some papers (called a note and loan agreement) spelling out the details of your loan agreement. While these basic concepts are simple, not everyone seems to clearly understand them. For example, some people put a great deal of energy into arranging to borrow money, but think little about the hard work that goes into repaying it. The important thing to understand is that the lender expects you to pay the money back. It’s only fair that you honor your promise if you possibly can. Your business may be so successful that you can pay back the loan sooner than the original note calls for and save some interest expense in the process. Some state laws allow repayment of the entire principal at any time with no penalty. However, laws in some states allow the lender to charge a penalty of lost interest if the borrower pays the loan back sooner than called for. Make sure you read the loan documents and ask about prepayment penalties. Your lender may be willing to cross a prepayment penalty clause out of the agreement if you ask As for the manner in which loans are repaid, there are about as many variations as there are loans. Here are the most typical: Fully amortized loan, This type of loan repayment provides for principal and interest to be paid off in equal monthly payments for a certain number of months. Balloon payment loan, This loan (sometimes called an interest-only loan) calls for repayment of relatively small amounts for a preestablished period of time. You then pay the entire remaining amount off at once.