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T-EPF M4L4 Key Terms
Traditional EPF Module 4 Lesson 4 Key Terms
Term | Definition |
---|---|
Collateral | Item of value offered as a guarantee that a borrower will pay back a loan; houses and cars are commonly used for this. |
Secured Credit | Loan with collateral offered as security for payment. |
Installment Credit | Credit where the total amount of the loan is divided over a fixed time period into equal monthly payments. |
Revolving Credit | Credit that is based on a fixed limit and charges are made on a continuing basis; credit cards are an example. |
Foreclosure | When a mortgage is not paid, the lender can take possession of the home and re-sell it to recover their investment. |
Unsecured Credit | Loan that has no collateral. |
Home Equity Line of Credit | Loan on the equity of the home that can be used like a credit card on a revolving basis. |
Equity | Stored value of an asset; for example, if a home valued at $150,000 had $40,000 paid on it, the equity is the $40,000. |
Bankruptcy | Legal process to eliminate an individual or business’s debt. |