| A | B |
|---|
| credit | receipt of money to buy goods or services in the present with the promise to pay for them in the future |
| commercial bank | bank whose main functions are to accept deposits, lend money, and transfer funds among banks, individuals, and businesses |
| credit bureau | private business that investigates a person to determine the risk involved in lending money to that person |
| credit check | investigation of a person's income, current debts, personal life, and past history of borrowing and repaying debts |
| secured loan | loan backed up by collateral |
| mortgage | installment debt owed on houses, buildings, or land |
| collateral | something of value used to secure a loan |
| finance company | financial institution that takes over contracts for installment debts from retailers and receives a fee for collecting the debt |
| finance charge | cost of credit expressed in dollars and cents |
| principal | amount of money originally borrowed |
| interest | amount of money a borrower must pay for the use of someone else's money |
| annual percentage rate | cost of credit expressed as a yearly percentage |
| unsecured loan | loan guaranteed only by a promise to repay it |
| durable goods | manufactured items intended to last more than three years |
| installment debt | debt that is repaid in equal payments over a fixed period of time |
| collateral | ____________________ is important to lenders because they can claim it if you cannot make payments on your loan. |
| banks | Visa and MasterCard cards are issued by ____________________. |
| bankruptcy | If you declare personal ____________________, the proceedings remain on your credit record for 10 years. |
| usury | ____________________ laws set ceilings on how much interest a financial institution can charge. |
| mortgage | The kind of loan used to finance the purchase of a house is a ____________________. |
