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21 terms

Chapter 4: Money in Review

Annual Fee
An amount that credit card companies can charge for the use of a credit card.
Annual Percentage Rate
the total cost of credit expressed as a yearly percentage
Adjustable Rate Mortgage (ARM)
Loan that has a fluctuating interest rate, usually one tied to a cost-of-funds index; the cost of doing business is the margin that stays fixed and is added to the base rate
Balloon Mortgage
a mortgage in which the entire remaining balance of the loan is due in one single payment
Money Owed
Credit Card
A plastic card used to make purchases now and pay for them later.
Credit Limit
the maximum amount of credit a lender will extend to a customer
Debit Card
a card (usually plastic) that enables the holder to withdraw money or to have the cost of purchases charged directly to the holder's bank account
Debt Consolidation
act of combinging all debts into one monthly payment, typically extending the terms and the length of time required to repay the debt
Debt Snowball
a strategy for reducing credit card debt that involves paying the minimum on all other card bills while attacking the one with the lowest balance
a decrease in price or value
Finance Charge
is the total dollar amount you pay to use credit.
to take possession of a property from a mortgagor because of defaults on payments
Grace Period
a time period during which no finance charges will be added to your account
Home Equity Loan
a loan secured by equity value in the borrower's home
Introductory Rate
A temporary interest rate, advertised as a low APR to entice customers to apply for a credit card. After the introductory period, the interest rate will increase to the regular APR.
a contract granting use or occupation of property during a specified time for a specified payment
Loan Term
The length of time you have to pay off a loan.
an imaginary story that has become an accepted part of the cultural or religious tradition of a group or society
the generally accepted perspective of a particular discipline at a given time
Tax Deduction
a reduction in the gross amount on which a tax is calculated