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» Debt Glossary - Credit and Debt Definitions Dictionary
Debt Glossary - Credit and Debt Definitions Dictionary
- authorized user - A credit card authorized user is someone who is able to make purchases on a credit card, but isn't legally liable for the credit card balance.
- annual fee - a yearly fee ranging from $15 to $300 charged by the credit card company for the convenience of the credit card
- application fee - the fee charged by a credit card company or bank for processing your application for credit
- APR - annual percentage rate
- average daily balance - a method of calculating finance charge
- balance transfer fee - the fee imposed for making a balance transfer
- balance transfer - the process of moving credit card debt from one credit card to another
- bankruptcy - a legal process in which a debtor asks the court for relief from its creditor and lenders
- billing cycle - the period of time between billings
- billing statement - a statement listing the purchases, payments and other debits and credits made to the credit card account within the billing cycle
- cash advance fee - the fee imposed when you take out a cash advance against your credit limit.
- cash advance - cash borrowed against your credit card balance
- charge card - a credit card without a credit limit requiring the balance to be paid in full at the end of each month
- charge-off - debt that has been determined uncollectible by the original creditor, usually after the debtor has become seriously delinquent
- credit bureau - an agency that collects and maintains individual credit information
- credit crunch - a period of time when credit is costly or difficult to obtain, usually both
- credit inquiry - an entry on a credit report that shows a business has requested a copy of the report
- credit limit - the maximum amount that can be borrowed on a credit card
- credit report - a report maintained by a credit bureau detailing your credit history
- credit score - a numerical summary of the information contained in your credit report
- credit utilization - the amount of purchasing power you have
- credit card issuer - Many people mistakenly think Visa or MasterCard is their credit card issuers, but that's not the case. Who is your credit card issuer?
- bank levy - A bank levy happens as the result of a court order. In a bank levy, the creditor is allowed to take money from your bank account to satisfy a debt.
- fraud alert -A fraud alert is a statement on your credit report that warns credit report viewers that you have been or may be a victim of identity theft.
- daily rate - The daily rate is 1/365th of your annual percentage rate
- debt to income ratio - the percentage of your income that goes toward paying your debt
- default rate - The default rate is the highest interest rate charged by a creditor or lender
- discretionary income - income left after taxes and necessary expenses have been paid
- disposable income - income left after taxes have been paid
- FCRA - The Fair Credit Reporting Act is a federal law that details how consumer credit information can be collected, given out, and used
- FICO score - The version of your credit score developed by and named after the Fair Isaac Corporation
- finance charge - cost of credit calculated using the APR and the balance
- foreclosure - a legal proceeding in which the bank can take possession of and sell a mortgaged property when the borrower does not meet his or her contractual obligations
- FTC - The FTC is a government agency that protects consumers against unfair business practices
- interest rate - an interest rate is the rate charged or paid for using money. You are charged an interest rate when you borrow money and paid an interest rate when you loan money.
- What is a Wage Garnishment - Learning you have a wage garnishment can be a scary thing because it means someone has court permission to take money from your paycheck.
- grace period - the period of time in which credit card payments can be made without interest penalty
- introductory rate - an interest rate, usually below-market, offered for the initial billing cycles of the credit card
- judgment - a court order to pay a certain amount of money to someone who has filed a law suit against you
- no limit credit card - a no limit credit card is a credit card that doesn't have a credit limit
- late fee - fee imposed when your payment is received after the due date
- minimum payment - Knowing the minimum payment on a credit card or loan is important to avoid fees and damage to your credit rating.
- nonrevolving credit - Credit that cannot be used after payment.
- maxed out credit card - A maxed-out credit card is not a good thing. Maxing out your credit limit can be expensive and harmful to your credit score.
- no preset spending limit - Some credit cards some with no preset spending limit, but that doesn't mean you can spend as much as you want to.
- Prime Rate - The prime rate is the interest rate that banks give to their most creditworthy customers.
- The Office of Thrift Supervision - The Office of Thrift Supervision regulates federal savings banks, federal savings and loans, savings and loans holding companies, and certain state-chartered institutions.
- open-ended account - an open-ended account is an account that has a varying, revolving balance
- revolving credit - Credit that can be used repeatedly up to a certain limit as long as payments are made
- promissory note - A promissory note is a written contract that includes a specific promise to pay.
- oral agreement - an oral contract is an agreement that was made verbally
- over the limit fee - fee imposed for exceeding your credit limit
- payday loan - a small, short-term loan that a borrower uses to cover expenses until the next payday
- periodic rate - the APR in relation to a period of time, i.e. monthly periodic rate is the monthly interest rate
- prime - the group or borrowers thought to be the the most credit-worthy and worthy of borrowing at the market interest rate
- return check fee - the fee imposed by a creditor or lender when your payment check is returned.
- payment due date - Your payment due date for credit card or loan is the date on which payment is due. For credit cards, the payment must be received by 5 pm on the due date or you’ll face late payment penalties.
- overdraft protection - Overdraft protection is a feature offered by banks to keep your checking account from overdrafting when you write a check or swipe your debit card but don't have enough money in your checking account to cover the balance.
- past due - When your account is past due, that means your account didn't have a payment applied as of your last due date. There are several negative consequences of being past due.
- payment grace period - A payment grace period is the amount of time from your due date that you can make a payment without receiving a late fee. Payment grace periods usually apply to loans and not credit cards.
- public record - Part of your credit report lists public records. These entries have the worst effect on your credit score.
- secured credit card - A secured credit card is a alternative for people who can't get approved for a regular credit card. That includes those with bad credit and brand new credit.
- statute of limitations - the amount of time a creditor or third-party debt collector can sue you for a debt
- student loan default - a state of delinquency on student loans occurring after you have violated the terms of your contract, e.g. have not made a payment or arrangements for at least 270 days.
- subprime - a segment borrowers that do not qualify for market interest rates because of bad credit history
- tax lien - the right, usually by the county, state, or federal government, to take possession of property due to a delinquency on taxes.
- universal default - the lender enforces default terms on a borrower that has defaulted with another lender
- variable interest rate - an interest rate that moves up and down based on another interest rate
- written contract - a written contract is an agreement made on a printed document that has been signed by both the lender and the borrower
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