Chapter 4- Debt Flashcards
Cost of borrowing money on an annual basis; takes into account the interest rate and other related fees on a loan
Annual Percentage Rate (APR)
Type of card issued by a bank that allows users to finance a purchase
Credit Card
A measure of an individual’s credit risk; calculated from a credit report using a standardized formula.
Credit Score
Preferred method of debt repayment; includes a list of all debts organized from smallest to largest balance; minimum payments are made to all debts except for the smallest, which is attacked with the largest possible payments
Debt Snowball
A decrease or loss in value
Depreciation
An interest rate charged to a customer during the early stages of a loan; the rate often goes up after a specific period of time
Introductory Rate
Time frame that a loan agreement is in force, and before or at the end of which the loan should either be repaid or renegotiated for another term
Loan Term
An expense, such as a charitable contribution, that can be deducted from one’s taxable income
Tax deduction
A yearly fee that’s charged by the credit card company for the convenience of the credit card
Annual Fee
