Credit Terms Flashcards
Spending Limit
The maximum amount you are willing to pay for an item
Financially Irresponsibility
Failing to live up to your financial obligations to meet your goals and needs
Receipt
A document acknowledging that a person has received money or property in payment following a sale or other transfer of goods or provision of a service
Comparison shopping
The practice of comparing the price of products or services from different vendors before buying
Debt
Money that must be repaid
Credit Card
A plastic card linked to a credit account that can be used to make purchases
Installment Credit
Credit used to finance the purchase of a single high-priced item through a series of equal payments made over a set period of time
Collateral
Property that can be used as security for a loan
Systematic Decision making
The process of making choices that reflect goals by considering all of the pros and cons along with the costs
Creditor
A person or business that loans money to others
Store account
A credit account that allows you to charge items or services only at that store or with that merchant
Buying Plan
An organized method for making good buying decisions
Debtor
The person who borrows money
Criteria
Standards or rules by which something is judged
Revolving credit
An account on which the account holder can charge repeatedly up to a maximum limit
Financial responsibility
Being able to meet your financial goals through planned earning, spending, and saving
Coupon
A voucher entitling the holder to a discount for a particular product
Consumer Loan
A direct loan of cash made to a consumer at a fixed interest rate for a set period of time
Rebate
A refund of part of the purchase price of an item
Line of credit
A preapproved loan amount that a debtor can borrow as needed with no collateral
Credit Report
A statement of your credit history issued by a credit bureau. It is a complete record of your borrowing and repayment performance
Extended Warranty
Additional coverage that you can buy to pay for repairs or replacements needed beyond the original warranty period
Credit Bureau
A business that gathers, stores, and sells credit information to business members
Finance Charge
The cost of borrowing money, including interest and other fees
Service Credit
The ability to receive services and pay for them later
The minimum payment
The amount you are required to pay each month on a credit account
Fixed Interest Rate
An interest rate that is set and does not change from month to month
Balance Transfer
Moving a balance from one credit card account to another
Penalty
A fee charged for violating a term of the credit agreement
Variable Interest Rate
An interest rate that goes up and down with inflation and other economic conditions
Cash Advance
Money borrowed against your credit card account
Billing Cycle
The amount of time you have to pay your current credit card balance in full to avoid paying interest
Grace Period
The period of time between credit card billings
