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13 terms

BMP Ch 18

the key terms
STUDY
PLAY
credit
the privilege of using someone else's money for a period of time
finance charge
the total dollar cost of credit including interest and all other charges
down payment
a payment of part of the purchase price that is made as part of a credit agreement
installment loan
a loan in which you agree to make monthly payments in specific amounts over a period of time
promissory note
a written promise to repay based on a debtor's excellent credit history
collateral
property that is used as security, giving the lender the right to sell this property to get back the amount of the loan if it is not repaid
cosigner
the party responsible for payment of a note if the borrower does not pay as promised
credit rating
a person's reputation for paying bills on time
interest
the money you receive for letting others use your money; the money you pay for using someone else's money
annual percentage rate
the percentage cost of credit on a yearly basis
credit application
a form on which you provide information needed by a lender to make a decision about granting credit
credit bureau
a company that gathers information on credit users and sells that information to business offering credit
statement of account
a record of the transactions completed during the billing period