Unit 4 Vocabulary

Front

A plan to limit the use of credit to no more than 20 percent of your yearly take-home pay, with payments of no more than 10 percent of monthly take-home pay.

Back

20/10 Rule

Front

A legal process that relieves debtors of the responsibility of paying their debts or protects them while they try to repay.

Back

Bankruptcy

Front

A reorganization form of bankruptcy for businesses that allows them to continue operating under court supervision as they repay their restructured debts.

Back

Chapter 11

Front

A reorganization form of bankruptcy for individuals that allows debtors to keep most of their property and use their income to pay a portion of their debts over three to five years.

Back

Chapter 13

Front

A liquidation form of bankruptcy for individuals that wipes out most debts in exchange for giving up most assets.

Back

Chapter 7

Front

A service to help consumers manage their debt load and credit more wisely.

Back

Credit Counseling

Front

Following an individual plan for using credit wisely.

Back

Credit Management

Front

A record of your debts and a strategy for paying them off.

Back

Credit Payment Plan

Front

The process of reestablishing a good credit rating.

Back

Credit Repair

Front

A type of debt relief service in which a finance company loans you money to pay off your debt.

Back

Debt Consolidation