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The yearly charge for the use of a credit card.
The interest rate for each loan period multiplied by the number of periods in a year. For example, a loan that charges 5% interest a month has an APR of 60%.
Any possession or property that has value in an exchange.
Legally declared inability of an individual or organization to pay their debt owed to creditors. Bankruptcy is filed in a Federal Court. There are various types of bankruptcy filings. The most common is Chapter 7 bankruptcy which relieves the individual/borrower of his debts and liabilities. A bankruptcy is reported to credit bureaus and may remain on your credit report up to 10 years after the filing of the case.
A cash advance (sometimes called payday loan) provides a small, unsecured, short-term cash advance that is usually repaid on the borrower’s next payday. The typical fee on a cash advance is $15 for a $100, two-week loan.
The amount of money coming into (in the form of wages, investment earnings, etc.) a household minus the amount going out (via debts and expenses). A positive cash flow indicates that there is more money coming into a household than being spent.
Returned or "bounced" check fees (also called non-sufficient funds fees) are charged to an account holder when the bank returns a check unpaid because there was not enough money in the checking account to cover the check amount. Bank charges for a bounced check average $30 and the retailer fees for the same bounced check are typically an additional $25.
A checking account allows a consumer to deposit funds and then write checks to be drawn on those deposited funds. Checking accounts vary widely: some charge a monthly fee, while others are free; some pay interest on the deposits, and, some have minimum balance requirements.
The asset that serves as a guarantee in the repayment of the loan. The borrower risks losing this asset if unable to repay a loan according to the terms of the loan.
When a borrower receives something of value, such as cash, in exchange for an agreement to repay the lender at a later time.
Someone who extends credit to a borrower and expects repayment of the loan with interest.
A credit agency collects and maintains debt payment histories of individual and corporate borrowers. Lenders use this information to evaluate a prospective borrower's ability to pay back debt.
A credit card is a plastic payment card that is linked to a credit account. The cardholder uses the card for payment, and receives an itemized statement of transactions at the end of each reporting period. If the balance is not paid in full by the end of the grace period, interest charges are added automatically to the account.
The documented and detailed statement of an individual's fully repaid debts. It helps a lender figure out the risk and creditworthiness of a potential borrower and whether he will be able to repay future debts in time.
A credit monitoring service notifies individuals of certain changes to their credit file. This service helps individuals detect any signs of credit fraud or identity theft before their credit history is damaged.
A number that reflects the credit history detailed in a person's credit report. Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers. The number helps the lender assign interest rates and terms to the loans they make. The higher the number, the better the terms that a lender will offer. If your credit score is low, it is possible to improve it over time by appealing incorrect items that appear on your report. It is important for consumers to monitor and track their credit reports to make sure information is correct and that disputed items do not remain on their reports.
A credit union is a non-profit organization that provides deposit and lending services. Its members share ownership in the organization, and therefore, share in its profitability. Individuals usually qualify for credit union membership by their association with a certain group, such as a labor union or military branch.
A debit card is a plastic payment card that's linked to a checking account. Debit cards are accepted for purchase transactions by many businesses. When the card is presented and approved for payment, the transaction amount is almost immediately deducted from the checking account balance. Debit cards can also be used at the ATM for cash withdrawals, deposits, and transfers.
An obligation or money owed to a company or person.
Bringing all of your loans together to form one single loan. This can create a lower monthly payment but extends the length of the loan.
Direct deposit is an electronic transfer of funds into a bank or credit union account. Many employers offer direct deposit instead of issuing paper paychecks. The IRS also offers direct deposit of tax refunds.
Discretionary income is the amount of one's earnings that is available for voluntary spending after paying for necessities such as food, shelter, clothing, and taxes.
The total sum of all the money, goods and property you receive during the year before it is reduced by deductions or tax exemptions.
A broad range of criminal activity involving theft or attempted theft of another individual’s personal identifying or account level information for the purpose of committing fraud or other crimes.
Additional money paid by a borrower to the lender for the use of the loan amount. Interest is calculated as a percentage of the money borrowed and paid over a specified time.
Charges from the lender when the borrower fails to make timely payment. For example, if a credit card bill isn’t paid on time, credit cards will charge an average fee of about $34.00.
The period of time in which the borrower has to repay the loan as outlined in the original loan contract. For example, auto loans are typically 4 years, mortgages typically have a loan term of 15 or 30 years, and payday loans typically have a 14 day loan term.
In addition to paying the bank a non-sufficient fund fee when the bank returns a check unpaid because there was not enough money in the checking account to cover the check amount, the retailer who accepted the dishonored check will charge a merchant/retail fee. The merchant/retail fee is about $25. An additional $30 fee is typically charged by the bank for non-sufficient funds.
The amount of your income left after taxes have been deducted.
Also known as a bounced check fee. The fee charged by the bank when the bank returns a check unpaid because there was not enough money in the checking account to cover the check amount. The typical NSF fee charged by the bank is $30. An additional $25 is typically charged by the retailer that accepted the dishonored check.
An overdraft occurs when purchases from a debit card or withdrawals from an account exceed an account's available balance of funds. Overdraft can also mean an immediate credit extension (loan), for example when there are insufficient funds in an account, the bank pays the check drafts and must extend credit to cover pending drafts.
Banks typically charge an overdraft fee when purchases from a debit card or withdraws to an account exceed an account’s available balance of funds. The average bank customer pays $27 for overdrawing their account.
Overdraft protection is a service offered on checking accounts. When a customer has it, the banking institution will pay the presented checks, even if the funds available in the account aren't sufficient to cover the check amount. There is usually a fee associated with overdraft protection.
A payday loan (also called payday advance or cash advance) provides a small, unsecured, short-term cash advance that is usually repaid on the borrower’s next payday. The typical fee on a payday loan is $15 for a $100 two-week loan.
A pawnbroker accepts personal property as collateral for a small loan. If the loan isn't repaid, the property is sold in a pawn shop. Jewelry, watches, and musical instruments are typical items that would be accepted by a pawnbroker.
A savings account is a bank or credit union deposit that earns interest and can be withdrawn on demand. Checks, however, can only be written from a checking account.
Advance of money that is secured by collateral or property that must be turned over to the lender if the loan is not repaid.
The eight digit number every US citizen is given at their birth. Non-citizens who are permanent residents may obtain a social security number as well. This number is used for identification, applying for loans, and for payout of social security checks upon retirement. To prevent identity theft, it is recommended the number is memorized and that consumers are extremely cautious when making it available.
Advance of money that is not secured by collateral or property.
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