| A | B |
|---|
| credit | an agreement to obtain money, goods or services now in exchange for a promise to pay in the future |
| installment sales credit | a contract issued by the seller that requires intermittent payments at specified times such as bi-weekly or monthly |
| consumer loans | require debtors to make monthly payments of a specified amount for a period of time |
| charge account | a contract between creditors and debtors. Charge accounts allow debtors (customers) to receive goods or services from suppliers (creditor) and pay for them at a later date. |
| regular charge account | A charge account with an electrician who re-wired a house |
| budget charge account | A charge account with Progress Energy utility company |
| revolving credit | home equity credit line |
| credit cards | allow debtors (customers) to receive goods and services from suppliers (creditor) using credit cards and pay for them later |
| interest | the cost of using someone else’s money |
| I=PRT | formula for computing simple interest |
| maturity date | the same day of the month that the loan was made |
| character | honesty to pay a debt when it is due and how past debt obligations were handled |
| capacity | refers to how much debt can comfortably be handled. |
| capital | current available assets that could be used to repay debt if income was to become unavailable |
| credit application | a form used by lenders to obtain information from applicants in order to make a decision about granting credit |
| credit data | make up the information that applicants provide on credit applications |
| credit bureaus | sell lenders credit information about credit users such as debt records, payment history, and if any action has been taken to collect overdue bills |
| credit contracts | are legal binding documents that allow debtors to use credit to obtain goods and services |
| statement of account | comes monthly and includes summary of transactions completed during the billing period |
| Truth in Lending Law | requires lenders to reveal the cost of credit (APR and finance charge) and terms before signing an application or contract |
| Equal Credit Opportiunity Act | allows credit applications be judged on financial responsibility of credit applicants |
| Fair Credit Billing Act | requires creditors to correct billing mistakes promptly |
| Fair Credit Reporting Act | allows individuals to scrutinize any information shared by credit reporting agencies with potential creditors and employers |
| Consumer Credit Reporting Reform Act | requires that the credit reporting agency must be able to prove that credit information they provide is accurate |
| Fair Debt Collections Act | prohibits deceptive, harassing, and unfair practices for collecting debt from debtors |
| Credit Card Accountability, Responsibility, and Disclosure Act | an amendment to the Truth in Lending Act. The act institutes fair and transparent practices of providing credit |
| Debt repayment plan | an agreement between a creditor and debtor that allows the debtor to pay off a debt with more manageable payment plan |
| Credit counseling | provides information on actions to take in order to manage debt |
| Bankruptcy | May be used by debtors to reduce debt or amount owed to creditors |
