Glossary Of Bad Credit Loans Terms
from CB Kliks

Useful glossary of bad credit loans terms
from CB Kliks

Here is a basic glossary of bad credit loans terms from CB Kliks bad credit loans web site to help you find your way around the mysteries of bad credit loans. For your convenience, the glossary of bad credit loans terms has been listed alphabetically. By understanding some of the basic glossary of bad credit loans terms you will be able to better follow the mechanics of a loan application. Also check out the following pages: Articles, Articles 2, Articles 3, Articles 4, Articles 5, Articles 6, Articles 7, Articles 8, Loan Calculator, Credit Score Calculator, FAQ, About Us, Contact Us, Links.

APR (Annual Percentage Rate)
APR is the rate of annual interest charged, that is calculated as a percentage of the loan.

Collateral
These are assets, such as a home or car, which are used to secure the repayment of a loan. If repayments are not made the borrower is at risk of losing such assets.

Credit History
A credit history will help a lender establish whether a borrower is a business risk or not by giving a record of an individual's debts and payment habits over a period of time.

Credit Limit
This is the maximum amount that you are able to borrow on credit by a financial institution or other lender.

Credit Report
A credit report is a record of an individual's debts and payment habits.

Credit Score
This is a three digit numerical score used to determine an individual's credit worthiness. Credit scores, often calculated with a computer system such as FICO (Fair Isaac Co.) help the lender decide whether or not to extend credit as well as the interest rate.

Default
Failure to repay a loan according to the terms of the promissory note.

Delinquent
This is overdue or any unpaid payments.

Disbursement
A payment of loan money to the borrower.

Discharge
The release of a borrower from the obligation to repay a loan.

Equity
Home equity is the difference between the fair market value and the unpaid mortgage on a home.

Interest
An expense of borrowing money that is calculated as a percentage of the amount borrowed.

Interest Rate
This is a percentage of the loan that is charged to the borrower for its use.

Line of Credit
Credit may be borrowed up to a maximum amount for a certain period of time as agreed by the lender.

Loan
Money borrowed that must be repaid.

Loan fee
An expense of borrowing deducted proportionately from each loan disbursement.

Principal balance
The amount owed on a loan, which includes any capitalized interest.

Promissory note
A legally binding contract between a lender and a borrower.

Repayment period
The period during which a borrower is obligated to make payments on a loan.

Variable interest
Rate of interest on a loan that is tied to a stated index and changes annually every July 1 as the index changes.

Variable Rate
This is a rate of interest that fluctuates, in relation to an index, over the term of the loan.

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