A-Credit - The best credit rating that a consumer can have. This rating entitles you to the lowest prices that a lender offers. A-Credit is usually considered any FICO score greater than 720.

Acceleration Clause - A provision in a mortgage that gives the holder the right to demand all of the outstanding balance immediately.

Accrued Interest - Interest that has been earned but not yet paid on a loan.

Acquisition Fee - Fee charged by the car leasing company, which may be paid up front or amortized into your car loan.

Adjustable Rate Mortgage (ARM) - A mortgage loan that has an interest rate that changes periodically based on economic indexes. The interest rate of an ARM loan is initially lower than a fixed rate loan.

Adjustment Interval - The time between changes in the interest rate of an ARM loan.

Advance payday loans - See payday loan

Amortization - The repayment of a loan through periodic installments over a fixed period of time.

Annual Percentage Rate (APR) - The percentage rate that providers charge users for carrying a balance on a loan, which is measured as a yearly rate. Some credit card providers offer 0 APR credit cards.

Application Fee - The fee that some lenders charge in order to accept an application.

Approval Letter - A lender's written acceptance of a loan application.

Asset - Cash or personal property that can be sold.

Auto Lease - A method of financing a car. Rather than an auto purchase, you essentially rent a car for a predetermined period of time. At the end of the car lease, depending on your car lease agreement, you can return or purchase your car.

Auto Lease Agreement - The contract that defines the terms and conditions of a car lease.

Auto Loans - A loan to pay for the purchase of a new or used vehicle.

Available Credit - The amount you have available to charge on your credit card or line of credit loan (Credit Line less your Current Balance).

Average Daily Balance - The most common method that lenders use to calculate Finance Charges. The Average Daily balance is the amount of your daily balance each day within a period of time defined by the lender that is added together and then divided by the number of days within that period.

Bad Credit - A term for a low credit rating. Your credit rating can be damaged by making late payments, missing payments, or declaring bankruptcy.

Balance/Amount Owed - The amount that you owe a lender. This includes: charges, cash advances, fees.

Balloon Payment - A large payment at the end of lease or a loan.

Bankruptcy - A legal process to declare an inability to pay off all debts. Declaring bankruptcy will eliminate all credit card debt, but will also seriously damage your credit rating and will remain on your credit for at least 10 years. Federal student loans, Federal taxes and child support are exempt from Bankruptcy protection. There are two types of Bankruptcy: Chapter 7 and Chapter 13.

Base Monthly Payment - The portion of your monthly car payments that goes to depreciation over the life time your auto lease. It is calculated as (Net Capitalized Cost Residual) / (the number of months in a vehicle lease).

Best Car Lease Deal - A lease where the auto lease company offers a special deal on a car lease. For example, where the car sale price is discounted, the car lease company offers a vehicle rebate, or the loan interest rate is low. Often best car lease deals are offered for cars that have a low depreciation, such as Honda, Mercedes or Lexus.

Bill Collectors - Agencies that are contracted by lenders to collect on the value of a loan.

Bill Consolidation - When you take out a single loan, possibly at a lower interest rate, to pay off multiple debts.

Billing Cycle - The period of time between your loan payment and your next loan payment.

Blue Book Value - The wholesale price that an auto dealer pays to buy a used car, which is published by Kelley Blue Book.

Body Type - The distinguishing characteristics of a car, such as the number of doors, windows, way it carries cargo (hatchback, sedan, fastback, sport, etc.)

Borrower - A person who applies and receives a loan from a lender with obligation to repay the loan in full.

Bridge Loan - A loan to fund a buyer's new residence until the buyer receives money from the sale of his/her existing residence.

Broker - A professional that represents a buyer and/or seller and assists in negotiating the contract.

Budget - The list of items that you spend money on and the amount of money that you earn. This list is organized in a systematic way in order to ensure that money is properly allocated for a given time period.

Business Lease - A car lease of one of more vehicles for commercial purposes.

Buy Lease - A type of comparison that calculates monthly car lease and auto loan payments, as well as total lease costs versus the total costs for purchasing a car.

Buy Leased Car - Either the buyout of a car at the end of your lease, or buying a car that was previously leased by someone else.

Buydown - A payment made to a lender in order to reduce the interest rate of a loan.

Buyer's Market - An economic market where conditions are in favor of the buyer.

Call Option - A provision allowing the lender to require payment of the loan before the end of the loan term.

Cap - A provision of an ARM that limits how much the interest rate or mortgage payments can increase.

Capital Gains - The profits earned from the sale of real estate.

Capitalized Cost - The value of your car at the start of your auto lease.

Car Buying Services - Websites, like FastFind™, which can help consumers search for better offers from car dealerships.

Car Lease - See auto lease.

Car Lease Assumption - When you end a car lease before the term is over and have someone else take over your lease.

Car Lease dDeal - The special offers made by a leasing company to promote car leases. For example, where the sale price is discounted, the car lease company offers a rebate, or the interest rate is low.

Car Lease Refinance - When you end an existing lease for a vehicle and start a new lease for the same car.

Car Lease Swap - The transfer of an auto lease to another party, such as a leasing company, before the lease is finished.

Car Lease Termination - When you end a car lease before the lease contract date.

Car Lease Trade - Trading a car that is still under lease, but whose term hasn’t been reached, for another leased car.

Cardmember Agreement - The credit card provider’s Terms and Conditions that apply to your credit card.

Cash Advance - A cash loan drawn against your credit card or pay check. Most credit card providers charge a Finance Charge starting the day you get a cash advance and ending when you pay off all credit card payments. Most cash advance lenders charge a flat fee.

Cash Advance Fee - A cash loan drawn against your credit card or pay check. Most credit card providers charge a Finance Charge starting the day you get a cash advance and ending when you pay off all credit card payments. Most cash advance lenders charge a flat fee.

Cash Out - The cash a borrower receives in addition to the remaining balance of a new loan.

Cash Till Payday Loan - See payday loan

Chapter 13 Bankruptcy - A type of bankruptcy where the filer follows a debt repayment plan and assets are not sold.

Chapter 7 Bankruptcy - A type of bankruptcy where the filer’s assets are sold by a court appointee to pay all debts.

Clear Title - Where the title of ownership for property or an item doesn't have any liens or legal issues regarding ownership.

Closed End Lease - Type of lease where you can buy the car if you wish to, or you can return it with no obligations.

Closing - The process of transferring ownership from the seller to the buyer.

Co-Borrowers - When 2 or more borrowers take out and repay a loan.

Co-sign - Where one person signs a loan application, such as a credit card application, with another person and agrees to assume the debt if the other person doesn’t pay.

Collateral - An asset that you put up as a guarantee for loan repayment.

Collection - The process of giving unpaid bills to an organization that specializes in recovering unpaid loans.

College Financing - See college loan

College Loans - A loan from the government, a university or a financial institution to pay college tuition.

College Tuition - The fees for attending a college.

Compounding - A type of interest that is applied to both the starting amount and the amount of interest that has been applied. Since compounding interest applies to the amount and the interest, interest payments to unpaid debt will grow over time.

Consolidate Debt - See Debt Consolidation.

Consumer Credit Counseling Service (CCCS) - A not-for-profit organization that provides financial counselors and will help negotiate with creditors.

Consumer Reporting Agency - A company that provides information to credit providers to assist in the decision to extend credit.

Credit - The amount of money a lender, such as a credit card provider, agrees to lend the person applying for a loan.

Credit Bureau - A company that produces a credit score based on your financial information. If a credit card provider denies your credit card application, they must tell you which Credit Bureau provided the credit score. You also have a right to request one free credit score per year from a Credit Bureau.

Credit Criteria - The information a lender, such as a credit card provider or mortgage company, uses when deciding whether or not to approve a loan application. This information includes: income, debt, number of credit cards, credit score, etc.

Credit History - Information about a person's financial activities over time. Loan providers review this information before deciding whether or not to approve a loan application. This information includes: income, debt, number of credit cards, credit score, etc.

Credit Line - See Line of Credit

Credit Report - A report on a person's credit history based on the information that each credit bureau has assembled on that person's finances over the last 7-10 years.

Credit Score - A score that is based on a person's credit history, debt, type of credit, number of bankruptcies, as well as many other factors. The most commonly used credit score is called the FICO score, which was developed by Fair Isaac Co.

Daily Periodic Rate - The interest rate used to determine daily interest fees. This rate is based on the yearly rate, divided by the number of days in the year.

Debt Consolidation - The process of merging several debts into 1 payment, which generally have lower monthly payments and extend over a longer period of time. For example, you can make a balance transfer between credit cards or get a Home Equity Loan to eliminate credit card debt.

Debt Elimination - See Debt Consolidation.

Debt to Income - Your monthly debt multiplied by 12 months and divided by your annual income. For example, if you earned $100,000 a year and have a monthly debt of $1000, you would have a DTI of 12%. This value is a type of credit criteria used by credit card providers and mortgage lenders when evaluating your application.

Default - When a borrower doesn’t make a loan payment according to the terms defined in the loan agreement.

Deferment - See deferred payment

Deferred Payment - The process of putting off payment of a debt until a later time. For example, deferring payment of a student loan until you’ve graduated.

Delinquency - A debt on which payment is overdue based on the loan terms and conditions.

Demand Clause - A clause allowing the lender to demand repayment at any time for any reason.

Depreciation - The amount that an item, such as a car, or real estate can go down in value over time. Typically causes for real estate depreciation are wear and tear on the property or a change in the neighborhood.

Disclosure Statement - A required statement that lists the actual costs of a loan.

Discount Points - An initial fee paid to the lender to lower the interest rate on a loan

Disposition Fee - A car leasing company fee charged at the end of an auto lease to refurbish a car for resale.

Down Payment - The difference between the price of a home and the loan amount.

Due at Signing - The amount of money you need to pay to a car leasing company when an auto lease is signed.

Due Date - The day that your payment must be received by your lender. If a payment is received after that date, a late fee may be charged.

Due-on-Sale Clause - A clause stating that the remainder of the loan is due on the sale of the property.

Early Termination Fee - A fee charged by car leasing companies for ending your car lease before the end of the predefined lease term.

Earnest Money - A deposit (a portion of the down payment) that is given by the prospective buyer to show serious interest in purchasing the home.

Equal Credit Opportunity Act - A Federal law prohibiting lenders and creditors from discriminating against a loan request based on race, color, religion, national origin, age, sex, marital status or income from public assistance programs.

Excess Mileage - The number of miles driven in excess of a specific number defined in your car lease.

Excess Wear & Tear - A level of physical wear on a car in excess of a level defined in your car lease.

Fair Credit Billing Act - The Federal Act that states that you have a right to find and fix billing errors within 60 days.

Fair Credit Reporting Act (FCRA) - The Federal Act that states that you have a right to check and correct errors on your credit report as well as verify that your credit history isn’t being misused.

Fair Debt Collection Practices Act - The Federal Law that states that you are protected from unfair treatment by debt collectors.

Fast cash advance - See payday loan

Fast cash loan - See payday loan

Fast payday loan - See payday loan

Federal Family Education Loan Program (FFELP) - Student subsidized, unsubsidized, and parent loans provided by the government.

Federal Financial Aid - Student loans or grants from the federal government based on financial need or specific qualifications.

Federal Financial Assistance - See federal financial aid

Federal Housing Administration (FHA) - A Federal agency that is a part of the Department of Housing and Urban Development, which provides mortgage insurance to private lenders.

Federal Reserve - The centralized United States bank, which sets interest rates and manages the flow of cash to local and regional banks, and helps to guarantee the security of the U.S. banking system.

FHA Mortgage - A mortgage that is insured by the Federal Housing Administration (FHA). Interest rates are generally equal to market rates and down payment requirements are generally normal.

FICO Score - The most common credit score model, also known as a Fair Isaac score. A FICO score ranges from 200 to 900 and a higher score makes a person a more reliable borrower.

Finance Charges - The fees charged by a lender related to a credit card or line of credit.

Financial Aid - Money for college tuition, books or other college expenses, which is available via grants, scholarships and loans.

Financing - A way to raise funds or capital for buying a new car, getting a mortgage on a house, or making purchases on a credit card.

Fixed Expenses - Expenses that are paid each month and that remain the same, such as mortgage, school tuition, car insurance, etc.

Float - The process that allows the rate to change with market conditions.

Forbearance - A method of putting off loan payments, such as for a credit card, for 6 month to a year, based on financial hardship. You can renew forbearance on a yearly basis for a maximum of three years.

Free Application for Federal Student Aid (FAFSA) - An application for student financial aid programs like Federal Pell Grants, Federal Stafford Loans or Federal Work Study.

Free Credit Report - Your right, under Federal law, to request a credit report from each of the three credit bureaus once a year.

Fair Credit and Charge Card Disclosure Act - The Federal Act that defines your rights to access your own financial information.

Garnished Wages - Where a borrower’s paychecks are held by court order and part of that paycheck goes to another individual or company to repay a debt or financial obligation.

Good Faith Estimate - An estimate of the charges a borrower is likely to pay as a result of a settlement.

Grace Period - The period of time after the due date of a loan payment in which payment can be made without a late penalty.

Grants - Financial aid provided by government agencies or private organizations that does not need to be repaid.

Gross Capitalized Cost - The selling price of your car.

Guaranteed Loan - When a lender offers a loan with the understanding that the loan is guaranteed to be repaid by another party if the borrower defaults.

Household Income - The total income made by all individuals in a household. This includes: salaries, bonuses, child support, social security, unemployment, etc.

Impound - A part of the borrower's monthly payments that is held by the lender to pay for taxes, insurance, lease payments and other housing payments that are due.

Index - An interest rate that is not controlled by the lender and is used in an Adjustable Rate Mortgage (ARM).

Inflation - The increase in prices for goods and services over time.

Installment Loan - A loan that is repaid in a series of payments rather than in one large sum. A home mortgage or home equity loan is an example of an installment loan.

Instant Payday Loan - See payday loan

Interest - Price paid for borrowing money.

Interest Rate - The percentage rate that a loan provider, such as a credit card provider, charges against the principal amount of money that the company loaned the borrower.

Interest Rate Cap - A limit on the amount to which an interest rate can change on an Adjustable Rate Mortgage (ARM).

Joint Liability - Liability shared by two or more people. Each person is liable for the full debt.

Jumbo Loan - A loan that is larger than the limit that is set by Fannie Mae and Freddie Mac.

Late Charge - A penalty that is paid by the borrower when a payment is made after the due date.

Late Fee - The fee charged for the late payment of a bill.

Late Payment - The payment on a bill that is made after the due date.

Late Payment Fee - The fee charged for the late payment of a bill.

Lease Luxury Car - Where you lease a high-end and more expensive vehicle, which has a lower depreciation, rather than buying a car outright.

Lease Residuals - The value of the car at the end of the lease based on MSRP.

Lender - The party that offers a loan.

Liability - A person's legal responsibility to repay a loan

Lien - A legal claim against a property that must be paid before the property is sold.

Lifetime Cap - A provision to an Adjustable Rate Mortgage (ARM) that states the maximum that a loan’s interest rate can increase over the life of a loan.

Line - The manufacturer name for a family of cars with certain features in common, such as body type, cab type, chassis, etc.

Line of credit - The amount of money you can draw from a credit account, such as a credit card or equity mortgage.

Loan Application - An request containing the information required to apply for a loan.

Loan-to-Value Ratio (LTV) - The percentage of the total value of the property that is mortgaged.

Lock - An option that can be exercised by the borrower that guarantees a specific interest rate over a period of time.

Make - The manufacturer name for a type of car

Maturity - The due date on which the final point of a loan must be paid.

Minimum Payment - The least amount of money that you must pay to your credit card provider by the statement’s due date.

Model - The manufacturer name for a group of cars of the same body type, make, line, and series.

Model Year - The year that a specific model of car was released by a manufacturer. Note: This can cover a two-year period.

Monthly Payment - The amount of money paid on a lease or loan each month.

Mortgage - A legal document that is held by a lender as security for repayment of a loan to purchase real estate.

MSRP - Manufacturer's Suggested Retail Price for an auto. This is also called "sticker price.”

Mutual Fund - A type of investment where the investment is spread across a variety of types of securities and is managed by professionals.

National Foundation for Consumer Credit (NFCC) - A not-for-profit organization that provides credit advice to consumers.

Negative Amortization - A loan payment where the outstanding balance of a loan goes up instead of down because the mortgage payments do not cover the amount of interest due.

Non-taxable Income - Income that you cannot be taxed for by any branch of the government.

Note - A document that serves as evidence to a debt and promise to repay.

Notice of Default - A written formal notice to a borrower that a default has occurred and that legal action may be taken.

Origination Fee - A fee that is paid to a lender to cover administrative costs of processing a loan application.

Paycheck advance - See payday loan

Payday loan - A loan that where you can use your paycheck as collateral for a cash advance before your payday.

Payment Cap - A provision of an Adjustable Rate Mortgage that limits how much a borrower's payments can increase.

PITI - Principal, Interest, Taxes and Insurance. These are the 4 components that make up a monthly mortgage payment.

Postdated check - A check that is dated after the current date.

Posting Date - The date that a dollar amount is charged against your loan, such as credit card or mortgage.

Power of Attorney - A legal document that grants authority to a person to act on the behalf of another.

Pre-approval - A commitment by a lender to provide a mortgage loan to a specified borrower. This approval is subject to verification at application.

Prepayment - The total payment of a loan before loan is due.

Prepayment Penalty - A fee that is charged to a borrower by the lender for paying off a loan early.

Prime Rate - The interest rates that banks charge to other banks or large corporate borrowers. Banks set their own prime rate and is often used as a basis for determining variable interest rates for loans such as credit cards or mortgages.

Principal - The amount of the actual loan not including the amount of interest.

Processing - The process of preparing the loan application and documentation for consideration by the lender.

Promissory Note - A legal document to get a loan, which defines a person's rights and responsibilities for that loan.

Purchase Agreement - A contract signed by the buyer and seller that indicates the conditions under which an item or property will be sold.

Purchase Contract - An agreement between the buyer and seller that indicate the prices and terms of the sale of the property or item.

Purchase Option Fee - The fee charged if the person leasing a car decides to buy the vehicle at the end of the car lease.

Purchase Option Price - The selling price of your car if you buy it at the end of a car lease.

Qualifying Ratio - The ratio of fixed monthly expenses to monthly income. This ratio is used by lenders to determine how much to loan to a homebuyer.

Rate Lock - An agreement that guarantees the interest rate of loan for a set period of time.

Refinancing - Paying of one loan with the proceeds from a separate loan that is secured by the same property.

Residual Value - The amount your car leasing company estimates your car will be worth at the end of your car lease, generally defined as a percentage of MSRP.

Revolving Credit - A type of credit agreement where as you pay the amount, the credit becomes available; for example, a credit card or home equity loan.

Second Mortgage - A mortgage that is in addition to the first mortgage. It is secured by the value of the primary home and includes home equity loans, credit lines, and home improvement loans.

Secured Debt - A debt that is guaranteed by property that is equal to or more than the amount of the loan.

Secured loan - A loan where you pledge collateral that must be given to the lender if you fail to repay the loan.

Security - A financial tool that serves as a pledge to payment of a debt.

Security Deposit - A payment made prior to entering an auto lease that is, usually, equal to one month's payment as security against excess wear and tear on your car.

Seller's Market - An economic market where conditions are in favor of the seller.

Series - The manufacturer name for a subtype of car model, which indicates price, size and specific features.

Stafford Loan - A type of government student loan.

Student Loan Marketing Association (Sallie Mae) - A government-sponsored corporation that purchases student loans on the secondary market.

Sub-prime Loan - A loan in which the borrower faces challenges in financing because of poor credit or any situation that would cause them difficulty in obtaining funds from lenders.

Term - The time period for which a loan must be repaid.

Trade-in value - The value that a car dealership will give you for your existing car as a deposit on a new car.

Transaction Date - The date that you made a purchase or got cash from your credit card. Some credit card providers charge your account from the date you make a purchase and others charge on a periodic cycle.

Transaction Fee - A fee charged for certain types of activities, such as getting a Cash Advance on your credit card, or a fee associated with getting a refinance mortgage.

Truth in Lending Act (TIL) - A law that states that certain information must be provided to the borrower upon receiving an estimate for the costs of a loan.

Tuition - The payment that is made to a university or college in order to be an enrolled student and attend class.

Underwriting - The process of evaluating a loan application to determine what risks are involved for the lender.

Unsecured Debt - A loan that is not guaranteed.

Unsecured loan - A loan whose repayment isn’t guaranteed by either collateral or a third party.

Upside down car loan - Where the amount of a car loan is more than the value of a vehicle.

VA Loan - A mortgage loan for veterans that is guaranteed by the Department of Veterans Affairs. This type of loan has low to no down payments.

Variable Expenses - The expenses that change on a monthly basis. These expenses can include: food, utilities, credit card purchase, etc.

Variable Interest Rate - An interest rate that changes periodically based on the Prime Rate.

VIN number - The unique Vehicle Identification Number that is assigned to each vehicle. Think of it as a Social Security Number for transportation. Current VINs are 17 digits long.

Wear and tear - The normal damage done to a vehicle over its lifetime.