EPF Unit 5

Debt you are responsible for

• Credit score
• liability

• Interest rate
• Loan term

debt that will always be backed by collateral, which the lender has a lien on

• secured debt
• convertible debt
• subordinated debt
• unsecured debt

has no collateral backing

• Without guarantee
• Unbacked
• secured debt

• Unsecured debt

a credit line that remains available even as you pay the balance

• closed credit line
• revolving credit line
• fixed credit line
• limited credit line

a loan that offers a borrower a fixed, or finite, amount of money over a specified period of time

• installment credit

• student loan
• business loan
• mortgage loan

legal proceeding initiated when a person or business is unable to repay outstanding debts or obligations

• foreclosure
• insolvency
• default
• bankruptcy

the extent to which a person or company is considered suitable to receive financial credit

• creditworthiness
• credit limit
• credit score
• credit rating

when you spend more money than you have available in your checking

• overextending
• overcredit

• overbudgeting
• overdraft

a prediction of how likely you are to pay a loan back on time

• interest rate
• loan amount
• credit score
• employment history