Unit 3 Credit Vocabulary Review

A mortgage in which the initial interest rate is normally fixed for a specified period of time after which it is reset periodically, often every month

• interest rate

• Adjustable Rate Mortgage (ARM)

• fixed rate mortgage

• fixed rate loan

A type of loan where you borrow money from your retirement savings account.

• 401K loan

• fixed rate loan

• adjustable rate loan

The paying off of debt over time in equal installments; part of each payment goes toward the loan principal while the other part goes toward interest

• amortization

• interest rate

• personal loan

A yearly fee that may be charged for having a specific credit card, independent of how you use the card

• interest fees

• penalty rate fees

• annual fee

The cost you pay each year to borrow money, including fees, expressed as a percentage

• APR (annual percentage rate)

• cash advance fee

• annual fee

A person who has permission to use and/or carry another person's credit card, but isn't legally responsible for paying the bill

• authorized user

• additional user

• credit card user

The act of transferring debt from one credit card account to another, usually for a fee

• balance transfer

• cash advance

• crowdfunding

A credit card service that allows cardholders to withdraw a certain amount of cash, either through an ATM or directly from a bank, typically at a high interest rate or for a fee

• balance transfer

• cash advance

• consolidation loan

• cosigner

A credit card benefit that pays the cardholder a small percentage of their net expenditures, often as cash, payment toward their balance, reward points, travel miles, or gift cards

• collateral

• cash back

• consolidation

• variable rate loan

Something valuable that the lender can take as payment if you can't or don't repay your secured loan

• consolidation

• collateral

• cosigner

• secured debt