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Consumer Credit

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Credit
an arrangement to receive cash, goods, or services now and pay for them in the future
Consumer Credit
is the use of credit for personal needs
Creditor
an entity that lends money
Close-end Credit
is credit as a one-time loan that you will pay back over a specified period of time in payments of equal amounts
Open-end Credit
is credit as a loan with a certain limit on the amount of money you can borrow for a variety of goods and services
Line of Credit
is the maximum amount of money a creditor will allow a credit user to borrow
Grace Period
a time period during which no finance charges will be added to your account
Finance Charge
is the total dollar amount you pay to use credit
Net Income
is the income you receive. ( take-home pay, allowance, gifts, and interest)
Annual Percentage Rate (APR)
is the cost of credit on a yearly basis, expressed as a percentage
Collateral
is a form of security to help guarantee that hte creditor will be repaid
Simple Interest
is the interest computed only on the principal, the amount that you borrow
Minimum Monthly Payment
is the smallest amount you can pay and remain a borrower in good standing
Credit Rating
is a measure of a person's ability and willingness to make credit payments on time
Cosigning
that you agree to be responsible for the loan payments if the other person fails to make them
Bankruptcy
is a legal process in which some or all of the assets of a debtor are distributed among the creditors because the debtor is unable to pay his or her debts