| A | B |
|---|
| Annual Percentage Rate | The cost of credit expressed as a yearly percentage |
| Bankruptcy | a legal process that relieves debtors of the responsibility of paying their debts or protects them while they try to repay |
| Capacity | The ability to repay a loan with present income |
| Chapter 11 Bankruptcy | Reorganization form of bankruptcy for businesses that allows them to continue business while restructuring debts. |
| Chapter 13 Bankruptcy | allows individuals to keep their property and use their income to pay a portion of their debts over 3 to 5 years |
| Chapter 7 Bankruptcy | Liquidation form of bankruptcy for individuals that wipes out most debts in exchange for giving up most assets |
| Character | a responsible attitude toward living up to agreements |
| Closed-Ended Credit | a loan for a specific amount that must be repaid, in full, including all finance charges by a stated due date |
| Conditions | existing debts, stability of employment and personal factors that determine a person's ability to meet financial obligations |
| Credit | money borrowed to buy something now, with the agreement to pay for it later |
| Credit Bureau | a company that gathers, stores, and sells credit information to business subscribers. |
| Credit Report | written statement of a consumer's credit history, issued by a credit bureau to its business subscribers |
| Creditor | a person or company that lends money to others |
| Debtors | a person who owes money to others |
| Discharged | erased by the courts during bankruptcy proceedings |
| Down Payment | a part of the purchase price paid in cash up front, reducing the amount of a loan |
| Finance Charge | the total dollar amount of all interest and fees you pay for the use of credit |
| Grace Period | an amount of time where no interest is charged on an amount borrowed |
| Interest | money paid for the use of money |
| Line of Credit | a pre-established amount that can be borrowed on demand with no collateral |
| Open-Ended Credit | an agreement to lend the borrower an amount up to a stated limit and to allow borrowing up to that limit again, whenever the balance falls below the limit |
| Principal | the amount borrowed or the unpaid portion of the amount borrowed, on which the borrower pays interest |
| Reaffirmation | the agreement to repay discharged debts |
