| A | B |
|---|
| fixed interest rate | A rate that does not change. |
| The 5 C's of Credit | Character, Collateral, Capacity, Conditions, and Capital |
| Balance Owed | The amount left over after subtracting, as for example, the amount owed on a loan. Also called the principle. |
| Commercial Bank | A financial institution that accepts deposits and channels the money into lending activities. |
| Bankruptcy Chapter 7 | A proceeding designed to sell off a debtor's property, pay off creditors, and relieve the debtor from most debts. Also called liquidation and straight bankruptcy. |
| Bankruptcy Chapter 11 | Deals with reorganization of businesses provides that unless the court rules otherwise, the debtor remains in possession of the business and in control of its operation. |
| Bankruptcy Chapter 13 | A reorganization form of bankruptcy for individuals that allows the debtors to keep their property and use their income to pay a portion of their debts over three to five years. |
| Cash Advance | Money lent; a loan given in cash by a credit card company, in anticipation of the borrower's being able to repay it. |
| Grace Period | A period in which debt may be paid without accruing further interest or penalty. |
| APR (Annual Percentage Rate) | Yearly percent amount it will cost a person to use credit |
| Credit Reporting Agency | A company that collects information from various sources and provides consumer credit information on individual consumers for a variety of uses. It is an organization providing information on individual's borrowing and bill paying habits. |
| Bankruptcy | A legal process to get out of debt when you can no longer make all of your required payments. |
| Variable Rate | An interest rate on a loan or security that fluctuates over time. |
| Co-signer | When someone with strong established credit signs a contract along with the borrower. |
| Default | Failure to repay a debt. |
| Finance Charge | The total amount that a person is charged for borrowing money; includes interests plus any service charges. |
| Unsecured Loan | Is a loan that does not require collateral from the borrower. |
| Secured Loan | Loan that is backed up by collateral |
| Open-End/Revolving Credit | A credit agreement that allows consumers to pay all or part of the outstanding balance on a loan or credit card. As credit is paid off, it becomes available again to use for another purchase. (Example credit card) |
| Closed-End/Installment Loan | A loan repaid in periodic installments (monthly payments) that include principal and interest. (Examples: Mortgage/Automobile payments) |
| Repossession | Taking away property due to failure |
| Consumer Credit Counseling Services (CCCS) | A non-profit agency that gives free advice to people in financial difficulties. |
