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CIV M8L3 Key Terms

Civics Module 8 Lesson 3 Key Terms

TermDefinition
Loan Borrowing money from a bank or other lender that will be repaid with interest.
Prime Interest Rate The interest rate a bank will charge its customers with the highest credit scores.
Subprime Loans Offered to people with lower credit scores and carry higher interest rates.
Fixed Rate Loans Loans that carry the same interest rate until the loan is repaid.
Variable Rate Loans Loans that carry interest rates that change as the market interest rate changes.
Adjustable Rate Mortgage The interest rate the homeowner pays will change each month as the prime rate changes.
Credit Making a purchase that will be paid for over time, including additional interest charges.
Credit Card A plastic card that allows a customer to make purchases that are paid for over time.
Interest Rate A percent that is paid on money in a bank account or money owed.
Credit Score A numeric value that explains a person's history of bill payments and used to determine credit worthiness.
Created by: dmcsorley13
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