Credit
Terms
Terms
Annual Percentage Rate; the yearly cost of borrowing money including interest and some fees.
What does APR stand for and what does it represent?
Offering different interest rates based on a borrower's credit score.
What is risk-based lending?
The total cost of borrowing including interest and fees.
What is a finance charge?
Credit that can be accessed repeatedly without a fixed repayment schedule.
What is open-end or revolving credit?
A loan backed by collateral like a car or house.
What is a secured loan?
To show important details like APR, fees, and payment terms on credit card offers.
What is a Schumer Box used for?
Banks, credit unions, or government programs.
Name a formal source of lending.
A legal process for people who can't pay their debts.
What is bankruptcy?
A loan with a specific amount and fixed repayment period.
What is closed-end credit?
The lender can seize the collateral.
What happens if you default on a secured loan?
A charge paid once a year to maintain a credit card or account.
What is an annual fee on a credit card?
Borrowing from friends, family, or community groups.
What is an informal source of lending?
Paying off loans in regular payments covering principal and interest.
What is amortization?
Programs offer customers discounts, points, or exclusive benefits in exchange for repeat purchases.
What are rewards or loyalty programs?
A loan not backed by collateral, based on creditworthiness.
What is an unsecured loan?
You may be charged an Over Credit Limit Fee.
What happens when you exceed your credit card limit?
Easier access, no credit checks, or personal trust.
Why might someone choose an informal lending source?
It negatively impacts your credit for years.
How does bankruptcy affect your credit?
A number (300–850) reflecting creditworthiness.
What is a credit score?
The borrower's credit score and income.
What determines approval for an unsecured loan?
Extra charges for actions like foreign transactions or missing payment deadlines.
What are transaction and late fees?
The intent of something or someone refers to...
What is a function?
Part of the loan principal and part of the interest.
What does each amortization payment include?
A detailed history of borrowing and repayment maintained by credit agencies.
What is a credit report?
A provider of account information and payment history to credit bureaus.
What is a data finisher?