Credit Flashcards
(48 cards)
An example of open-end credit is
Credit card or home equity loan
An entity such as a bank, finance company, credit union, business, or individual to which money is owed
Creditor
The total dollar amount you pay to use credit
Finance Charge
A time period during which no finance charges are added to a credit card account.
Grace Period
Businesses that collect debt for creditors
Debt Collector
The amount of money that a person borrows is called
Principal
An asset used as a form of security to help guarantee that a creditor will be repaid. It can be taken in case a debt is not paid
Collateral
The smallest amount you can pay and remain a borrower in good standing
Minimum Monthly Payment
The type of credit where you receive a one time loan that you will pay back over a specified period of time and in payments of equal amounts
Close End Credit
A measure of a person’s ability and willingness to make credit payments on time
Credit Rating
The best annual fee for a credit card would be
No Annual Fee
When a person agrees to be responsible for loan payments if the other party fails to make them
Co-Signer
If you report a credit card lost or stolen and there are fraudulent charges on the account, you would typically be responsible for what amount of money
There’s no legal limit, the card company chooses how much but must state it in writing.
A legal process in which some or all of the assets of a debtor are distributed among the creditors because the debtor is unable to pay his or her debts.
Bankruptcy
The maximum amount of money a creditor has made available to a person
Credit Limit
How should a consumer begin to correct a mistake on a credit card bill?
Call and also notify the creditor in writing
Requires consumers under the age of 21 to prove that they have an independent income or get a co-signer before applying for a credit card.
CARD Act
A typical credit bureau file consists of the following
Your social security number, your employer, position, and income
If you default on a loan, it will stay on your credit report for
7 years
The finance charge on a credit card is calculated using the
Annual Percentage Rate
Prohibits credit discrimination on the basis of sex, race, martial status, religion, national origin, age, or receipt of public assistance.
Equal Credit Opportunity Act
Requires creditors to disclose in writing certain cost information, such as the annual percentage rate (APR), before consumers enter into credit transactions
The Truth in Lending Act
Insures the accuracy and privacy of information, kept by credit bureaus and consumer reporting agencies. It gives consumers the right to know what information credit bureau’s and consumer reporting agencies are distributing about them to creditors, insurance companies, and employers
Fair Credit Reporting Act
The income you receive after taxes are taken out
Net Income
