CC Midterm

The 5 Cs of Credit:

Answer explanation

1. CAPACITY

2.CAPITAL

3 CONDITIONS

4 CHARACTER

5. COLLATERAL

Types of Fees:

Answer explanation

6. ANNUAL FEES

7.CASH ADVANCE FEES

8. LATE PAYMENT FEES

9. UPFRONT FEES

10. INSURANCE FEES

Types of Credit:

Answer explanation

11.SERVICE CREDIT

12. REVOLVING CREDIT

13. OPEN CREDIT

14. LOANS

This refers to something you can provide as security

Answer explanation

COLLATERAL

This is a contract agreement in which a borrower receives a sum of money or something of value and repays the lender at a later date, generally with interest.

Answer explanation

CREDIT

This refers to the borrower's reputation and credit history.

Answer explanation

CHARACTER

These are charges levied for specific services or transactions, and they are common in various industries.

Answer explanation

FEES

It is implementing and maintaining a set of policies and procedures to minimize the amount of capital tied up in debtors and to minimize the exposure of the business to bad debts.

Answer explanation

CREDIT MANAGEMENT

This refers to your ability to repay a loan.

Answer explanation

CAPACITY

This refers to the ability of a borrower to obtain goods or services before making payment, based on the trust that the payment will be made in the future.

Answer explanation

CREDIT