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Credit Cards
| Term | Definition |
|---|---|
| Annual fee | an annual fee is a yearly charge levied by a credit card company or other financial institution |
| Annual percentage rate (APR) | a yearly percentage that represents the total cost of borrowing money, including interest and other fees. |
| Balance transfers | moving an outstanding debt from one credit card or loan to another |
| Bankruptcy | a legal proceeding initiated when a person or business cannot repay outstanding debts or obligations. |
| Cash advances | a small, short-term loan, often against a credit card, that allows you to withdraw cash |
| Co-signer | someone who agrees to take on the responsibility of repaying a loan if the primary borrower defaults |
| Courtesy Checks | a service offered by financial institutions that allows transactions to process even when insufficient funds are available in a checking account |
| Credit bureau | an organization that collects and stores financial data about individuals' credit history |
| Credit card | a physical or digital card that allows cardholders to borrow funds to make purchases and pay for them later |
| Credit history | a record of an individual's borrowing and repayment activity, reflecting their ability to manage and repay debts |
| Credit limit | the maximum amount of money a lender allows a borrower to spend on a credit card or line of credit. |
| Credit report | a record of your financial history, including how you've managed debt. |
| Credit score | a number, typically ranging from 300 to 850, that summarizes an individual's creditworthiness, reflecting their ability to repay debts and their credit risk. |
| Debt | a financial obligation or amount owed by one party (the debtor) to another (the creditor), typically for funds borrowed, and is to be repaid, often with interest. |
| Finance charge | a fee charged for the use of credit or the extension of existing credit. |
| Grace period | a set amount of time after a due date when a payment can be made without penalty |
| Interest rate | the cost of borrowing money, expressed as a percentage of the principal, paid by a borrower to a lender for the use of their funds. |
| Introductory rate | a temporary, lower interest rate offered on loans or credit cards to attract customers, which reverts to a higher standard rate after a specified period. |
| Late payment fee | an additional charge levied by a lender or service provider when a borrower or customer fails to pay a bill or loan installment by the agreed-upon due date. |
| Lender | a person or institution that provides money to a borrower in exchange for repayment, plus interest. |
| Line of credit | a preset amount of money that a borrower can access from a financial institution. |
| Over-the-limit fee | a charge imposed by a credit card issuer when a cardholder's balance exceeds their credit limit |
| Pre-approved | When a lender has preliminarily assessed a borrower's creditworthiness and is tentatively willing to lend a specific amount, but it's not a guaranteed loan offer. |
| Principle | original amount of money borrowed in a loan or invested in an asset |
| Secured Loan | a type of loan backed by collateral, like a car or home, that the lender can seize if the borrower defaults, offering them a lower risk and potentially lower interest rates. |
| Term | the length of time or lifespan of an investment, loan, or other financial instrument, from its inception to its maturity or repayment. |
Created by:
Sbowers26
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