DEFINITION of 'Permanent Loan'

A form of loan agreement in which an individual, trust, or company loans artwork or other objects to a museum for an extended period of time. The loan agreement may stipulate that the museum must display the loaned artwork in a specific area of the museum, that the artwork is to be displayed as part of an exhibition, or that the artwork is not to be shown in a touring exhibition.

BREAKING DOWN 'Permanent Loan'

Providing artwork to a museum under a permanent loan carries a certain level of prestige, especially if the artwork is well known. The museum may prominently display the name of the benefactor in its literature, and may even name an exhibition hall after the individual or trust.

Accepting artwork under a permanent loan does put a museum at a risk, however. While the word “permanent” is used to describe the time period of the loan, objects loaned under this sort of agreement can still be withdrawn at any time. For example, the heirs of a wealthy collector may request a painting be returned. Additionally, museums that rely on permanent loans may fail to acquire their own pieces. If loaned artwork is recalled the museum will see an immediate drop in the objects available for display.

RELATED TERMS
  1. Future Advance

    A clause in a mortgage which enables the lender to advance funds ...
  2. Renegotiated Loan

    The result of an agreement between a borrower and a lender to ...
  3. Refinance

    1. When a business or person revises a payment schedule for repaying ...
  4. Commercial Loan

    A debt-based funding arrangement that a business can set up with ...
  5. Fractional Gift

    A gift that provides a fractional interest in an artwork today, ...
  6. Combination Loan

    1. A transaction consisting of two separate loans for the same ...
Related Articles
  1. Insights

    An Introduction to Government Loans

    Government loans further policymakers' efforts to create positive social outcomes by offering timely access to capital for qualified candidates.
  2. Managing Wealth

    Importance of Title in Art Transactions

    A work of art can be a valuable investment, but it’s important to verify that it isn’t stolen property when you purchase it.
  3. Managing Wealth

    Unsecured Personal Loans: 8 Sneaky Traps

    If you are seeking a personal loan, be aware of these pitfalls before you proceed.
  4. Personal Finance

    College Loans: Private vs. Federal

    Not all student loans are the same. Know what you're getting into before signing on the dotted line.
  5. Personal Finance

    Personal Loans: To Lend Or Not To Lend?

    Attempting to help a loved one with a cash loan can put a strain on your relationship - and your bank account.
  6. Personal Finance

    All About Government Loans

    There are many reasons to seek a government loan rather than one from a private lender. Government loans typically have low interest rates and offer fixed or subsidized options, as well as deferred ...
  7. Personal Finance

    Understanding Loans

    A loan is the act of giving money, property or other material goods to another party with the expectation of being repaid.
  8. Managing Wealth

    When Are Personal Loans a Good Idea?

    You never want to borrow money for frivolous reasons, but these five circumstances might warrant it.
RELATED FAQS
  1. Are secured personal loans better than unsecured loans?

    Read about the differences between secured loans and unsecured loans and how they are used. Learn about forms of collateral ... Read Answer >>
  2. What are the differences between delinquency and default?

    Find out more about loan delinquency, loan default, and the difference between a loan borrower defaulting and being delinquent ... Read Answer >>
Hot Definitions
  1. Trumpcare

    The American Health Care Act, also known as Trumpcare and Ryancare, is the Republican proposal to replace Obamacare.
  2. Free Carrier - FCA

    A trade term requiring the seller to deliver goods to a named airport, terminal, or other place where the carrier operates. ...
  3. Portable Alpha

    A strategy in which portfolio managers separate alpha from beta by investing in securities that differ from the market index ...
  4. Run Rate

    1. How the financial performance of a company would look if you were to extrapolate current results out over a certain period ...
  5. Hard Fork

    A hard fork (or sometimes hardfork) is a radical change to the protocol that makes previously invalid blocks/transactions ...
  6. Interest Rate Risk

    The risk that an investment's value will change due to a change in the absolute level of interest rates, in the spread between ...
Trading Center