Managing Credit Vocabulary

Annual Percentage Rate (APR)

• Yearly interest rate charged on borrowed money

• A type of loan with no interest

• A fee charged for late payments

• The total amount of money borrowed

Credit Limit

• Maximum amount you can borrow on a credit account

• Minimum amount required to open a credit account

• Total amount of interest charged on a credit account

• Amount of cash available in your bank account

Principal

• Original sum of money borrowed

• Total interest paid

• Amount of money after investment

• Monthly payment amount

Balance Transfer

• Moving debt from one card to another

• Transferring funds between bank accounts

• Consolidating loans into a single payment

• Paying off a credit card with cash

Credit

• Borrowing money to buy now, pay later

• A type of payment made in cash

• A method of saving money for future purchases

• A loan that must be repaid immediately

Credit Score

• Numerical rating of creditworthiness

• A measure of income stability

• An assessment of loan eligibility

• A record of past financial transactions

Late Fee

• Charge for missing a payment deadline

• A fee for early payment

• A discount for timely payment

• A penalty for exceeding credit limit

Interest Rate

• Cost of borrowing, expressed as a percentage

• A fee paid to the lender for the use of money

• The total amount of money borrowed

• A percentage of the principal amount that is paid back

Credit History

• Record of past borrowing and repayments

• A summary of current debts

• A list of credit card offers

• An evaluation of credit scores

Default

• Failure to repay a loan

• A type of loan with low interest

• A legal term for a successful payment

• A financial term for a credit score