PFL: Terms 3
Terms in this set (67)
An item with economic value that an individual or organization owns, such as stocks, real estate, personal property, and business equipment.
The percentage cost of credit on an annual basis, which must be disclosed by law.
The annual rate of return on an investment, which must be disclosed by law and which varies by the frequency of compounding.
A state of being legally released from the ob- ligation to repay some or all debt in exchange for the forced loss of certain assets. A court's determination of personal bankruptcy remains in a consumer's credit record for 10 years.
A person or organization named to receive as- sets after an individual's death.
A certificate representing the purchaser's agreement to lend a business or government money on the promise that the debt will be paid — with interest — at a specific time. (least risky- guarantees profit)
1. A spending plan.
2. A record of projected and actual income and expenses over a period.
A description of a company's organizational structure, staff, activities, and marketing and financial plans, including expected sources of income and expenses.
Income that results when the selling price of an asset is greater than the original purchase price.
Monetary loss that occurs when the selling price of an asset is less than the original amount invested.
Cash flow statement
A summary of receipts and payments for a given period, helpful when preparing a budget; also known as an income and expense statement.
A specific-purpose loan requiring repayment with interest and any other finance charges by a specific date. Examples include most mortgages or auto loans. (strict, not flexible)
Property that a borrower promises to give up to a lender in case of default.
Payment and benefits for work performed; also payment to injured or unemployed workers or their dependents.
Calculating interest on both principal and previously earned interest.
A legally binding agreement between two or more parties.
An agreement to provide goods, services, or money in exchange for future payments with interest by a specific date or according to a specific schedule. The use of someone else's money for a fee.
A plastic card that authorizes the delivery of goods and services in exchange for future payment with interest, according to a specific schedule.
Credit counseling service
An organization that provides debt and money management advice and assistance to people with debt problems.
An official record of a borrower's credit history, including such information as the amount and type of credit used, outstanding balances, and any delinquencies, bankruptcies, or tax liens.
A statistical measure of a loan applicant's credit- worthiness, which is the likelihood of repayment.
Lowest score- 300
Highest score- 850
Systematic decision making
A method of selecting a course of action after gathering and evaluating information and considering the costs and benefits of various alternatives and consequences.
A plastic card that provides access to electronic funds transfer (EFT) from an automated teller machine (ATM) or a point-of-sale (POS) terminal. Takes money from your personal savings or bank account.
Something owed, usually measured in dollars.
The dollar amount or percentage of a loss that is not insured, as specified in an insurance policy.
The failure to meet a financial obligation or agreement.
Gross pay minus deductions for taxes.
A strategy for reducing some types of risk by selecting a wide variety of investments.
Earnings from corporate stock or credit union share accounts.
Short-term loans granted regardless of credit history, often for very short periods and at high interest rates.
The shifting of money from one financial institu- tion account to another without the physical movement of cash. (store checkouts with debit cards)
Money set aside for unexpected expenses or for living costs in case of job loss.
Compensation that an employee receives in addition to a wage or salary. Examples include health insurance, life insurance, childcare, and subsidized meals.
A federal law that forbids lenders from discrimi-nating against loan applicants on the basis of gender, race, marital status, religion, national origin, age, or receipt of public assistance.
Stock ownership in a corporation.
The cost of goods and services, including those that are fixed (such as rent and auto loan pay- ments) and those that are variable (such as food, clothing, and entertainment).
A federal law that gives consumers more ways to recover their credit reputations after they have been victims of identity theft, and allows consumers to request one free copy of their credit reports from the major credit reporting agencies each year.
bank for the local area
given money and never needed to repay
money they give you that you have to repay
computer scam that uses spam or pop up messages to deceive consumers into disclosing their information
maximum amount of money a person can borrow
you will get hurt
if your vehicle gets hurt
everything you own
actual cash value
valuing insured property
replacement cost to replace lost items
investing strategy intended to protect an investment or portfolio against loss
claim that is unlimited
mostly payments to an insurance company
something you have to pay off
amount of liquid assets you have (stocks, easily converted to cash)
possibility that a borrower fails to repay a loan on time and will never be able to repay the loan
interest rate risk
risk that arises for bond owners from fluctuating interest rates
risk that a given security or asset cannot be traded quickly enough in the market to prevent a loss (or make the required profit).
probability or likelihood of occurrence of losses relative to the expected return on any particular investment
person makes payments over the year to pay for the purchase
pay for purchases directly from a checking or a savings account
highest interest rate on a loan (charging)
asks bank not to honor a specific check
their credit score, credit cards, loans, etc.
mortgage interest rate is set
give money for the stock
bank pays you amount of money
cost o making one decision over another