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W!SE Credit
| Term | Definition |
|---|---|
| 3 C's of credit | capacity, character & collateral |
| APR (Annual Percentage Rate) | The annual rate charged for borrowing or earned through an investment. |
| Auto finance companies | Companies that provide financing for the purchase of vehicles. |
| Balance owed | The total amount of money that is still owed on a loan or credit account. |
| Bank | A financial institution that accepts deposits from the public and creates credit. |
| Bankruptcy | A legal status of a person or other entity that cannot repay the debts it owes. |
| Bankruptcy: Chapters 13 | A type of bankruptcy that involves a repayment plan for individuals with a regular income. |
| Cash advances | Short-term loans taken against a credit card's available credit. |
| Charge cards | Cards that require the balance to be paid in full each month. |
| Collateral | An asset that a borrower offers to a lender to secure a loan. |
| Consolidation loans | Loans that combine multiple debts into a single loan with a lower interest rate. |
| Consumer Credit Counseling Services (CCCS) | Organizations that help consumers manage their debt and improve their credit. |
| Consumer debt | Debt incurred by individuals for personal, family, or household purposes. |
| Co-signed loans | Loans that are guaranteed by a second party, who agrees to pay if the borrower defaults. |
| Credit card companies | Companies that issue credit cards and manage credit card accounts. |
| Credit cards | Plastic cards issued by financial institutions that allow users to borrow funds. |
| Credit history | A record of a borrower's responsible repayment of debts. |
| Credit rating | An assessment of the creditworthiness of a borrower. |
| Credit report | A detailed report of an individual's credit history. |
| Credit reporting agency | An organization that collects and maintains consumer credit information. |
| Credit score | A numerical expression based on a level analysis of a person's credit files. |
| Credit risk | The risk of default on a debt that may arise from a borrower failing to make required payments. |
| Default | Failure to fulfill a financial obligation. |
| Due date | The date by which a payment must be made. |
| Finance charge | The cost of borrowing money, typically expressed as a percentage. |
| Fixed interest rate | An interest rate that remains the same for the entire term of the loan. |
| Fixed rate of interest | An interest rate that does not change over the life of the loan. |
| Foreclosure | The legal process by which a lender takes possession of a property due to default. |
| Garnishment | A legal process whereby a portion of a person's earnings is withheld for the payment of a debt. |
| Grace period | A time frame during which a borrower can make a payment without incurring a penalty. |
| Home equity loans | Loans that allow homeowners to borrow against the equity in their home. |
| Identity theft | The unauthorized use of someone else's personal information. |
| Installment loans/credit | Loans that are repaid over time with a set number of scheduled payments. |
| Interest [APR] | The cost of borrowing expressed as an annual percentage. |
| Late fee | A charge imposed for failing to make a payment by the due date. |
| Lien | A legal right or interest that a lender has in the borrower's property. |
| Credit limit | The maximum amount of credit that a financial institution extends to a client. |
| Line of credit | An arrangement between a financial institution and a customer that establishes a maximum loan balance. |
| Liquidation | The process of selling off assets to pay debts. |
| Low credit rating | A score indicating a higher risk of default. |
| Minimum amount due | The smallest amount that must be paid on a credit account to avoid penalties. |
| Minimum payment | The lowest amount a borrower can pay on a loan or credit card bill. |
| Mortgage | A loan specifically for purchasing real estate. |
| Mortgage brokers/lenders | Individuals or companies that help borrowers find and secure mortgage loans. |
| Overspending | Exceeding one's budget or financial limits. |
| Ownership | The state of possessing something. |
| Pawn shops | Businesses that offer secured loans to people, with personal property used as collateral. |
| Pawn ticket | A receipt given to a customer when they pawn an item. |
| Payday loans | Short-term, high-interest loans typically due on the borrower's next payday. |
| Penalty | A punishment for failing to meet a financial obligation. |
| PIN | Personal Identification Number used for secure transactions. |
| Predatory lending | Unethical practices by lenders to entice, induce, or coerce borrowers. |
| Prepayment | The act of paying off a loan before its due date. |
| Promotional Rate | A temporary interest rate that is lower than the standard rate. |
| Repossession | The act of taking back property by a lender when the borrower defaults. |
| Revolving credit | A type of credit that allows the borrower to withdraw, repay, and withdraw again. |
| Secured Credit card | A credit card backed by a cash deposit from the cardholder. |
| Secured loans | Loans that are backed by collateral. |
| Unsecured loans | Loans that are not backed by collateral. |
| Tax preparers | Professionals who assist individuals in preparing their tax returns. |
| Title for goods | A legal document proving ownership of an asset. |
| Truth in Lending Act of 1968 | A federal law designed to promote the informed use of consumer credit. |
| Usury | The illegal action of lending money at unreasonably high-interest rates. |
| Variable interest | An interest rate that can change over the life of the loan. |
| Variable rate | An interest rate that fluctuates based on market conditions. |
Created by:
moonpool13
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