Jargon Buster - Finance in Plain English

May 16, 2008 Debt No Comments

Jargon Buster - Finance in Plain English
Jargon Buster


Adverse Credit: used to describe a person who has a history of defaulting on credit repayments, has county court judgements or has been declared bankrupt.


APR (Annual Percentage Rate): the total amount of interest and other fees charged on a loan.


Arrears: when a borrower has fallen behind on loan or mortgage repayments.



Bad Credit: Common practices that can damage a credit rating including making late payments, skipping payments, exceeding card limits or declaring bankruptcy.



Broker: an individual who sources financial products best suited to an individual’s needs



Cashback: an incentive whereby the borrower receives back a sum of money when taking out a loan



CCJ (County Court Judgement): a court order against a borrower demanding they pay back money owed



Credit Agreement: a signed agreement between the lender and borrower, outlining terms and conditions relating to the loan



Credit Reference Agency: a company the provides lenders with individual’s credit details and history



Credit Score: an applicant’s credit status based on searches carried out by credit reference agencies



Fixed Interest Rate: an interest rate the remains the same throughout the loan term



Over-Repyaments: when payments are higher or more frequent than stipulated in the credit agreement



Payment Protection: an insurance plan that will take care of loan repayments on your behalf in the event of illness or redundancy



Secured Loan: where a borrower’s property is used as security to guarantee repayment of the loan



Self-Certification: where the loans company allows the applicant to state his income without providing evidence



Term: the period of time between the beginning loan date on the legal documents and the date the entire balance of the loan is due



Under-Repayments: when payments are lower or less frequent than stipulated in the credit agreement, often authorised by lenders if the borrower is struggling to make repayments but is committed to making some contribution until the situation improves



Underwriting: the assessment made by a lender to decide whether to approve a loan application



Unsecured Loan: a loan that does not require the borrower to use his home as security



Variable Rate Interested: an interest rate that will fluctuate throughout the loan term, either up or down depending on market forces.

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Before you select a debt relief agency to pay off your overwhelming debt finance, you need to take a deep look in to other debt relief options. Especially if you have a good credit repair for your credit report authorized by a leading bank. Although not preferred but you can consider credit consolidation option. Even if you don’t have a good credit rating, you can still get the options like bad credit home loan which is difficult to pay back though and can involve you in a process where your credit collection and credit repair rating is going to fall.

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