Financial Concepts Flashcard

Front

What does 'Line of Credit (LOC)' mean?

Back

A flexible loan from a bank that allows you to borrow up to a set limit and repay as needed.

Front

What does 'Revolving Credit' mean?

Back

A type of LOC where the available balance renews as you pay it back.

Front

What does 'Draw Period' mean?

Back

The time frame during which you can borrow from the LOC.

Front

What does 'Credit Limit' mean?

Back

The maximum amount you can borrow.

Front

What does 'Principal' mean?

Back

The original amount of money borrowed.

Front

What does 'Interest Rate' mean?

Back

The cost of borrowing, expressed as a percentage.

Front

What does 'Term Loan' mean?

Back

A loan paid off over a fixed period.

Front

What does 'Amortization' mean?

Back

The schedule of payments applied to both principal and interest.

Front

What does 'Secured Loan' mean?

Back

A loan backed by collateral, like a car or house.

Front

What does 'Lease Agreement' mean?

Back

A contract to use something (usually a vehicle or property) for a set time and cost.