Created by Eli Southard
over 1 year ago
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Question | Answer |
Amortization | Process of paying back a loan |
Amount Financed | Cash price less down payment |
Annual Percentage rate | True or effective annual interest rate charged by sellers. Required to be stated by Truth in Lending Act |
Average Daily Balance | Sum of daily balances divided by number of days in billing cycle |
Cash Advance | Money borrowed by holder of credit card. It is recorded as another purchase and is used in the calculation of the average daily balance |
Credit Card Act | A federal statute passed in 2009 to provide fair and transparent practices to the extension of credit |
Daily Balance | Calculated to determine customer's finance charge |
Deferred Payment Price | Total of all monthly payments plus down payment |
Down Payment | Amount of initial cash payment made when items is purchased |
Fair Credit and Charge card disclosure Act of 1998 | Act that tightens controls on credit and companies soliciting new business |
Finance Charge | Total payments- Actual loan cost |
Installment Loan | Loan paid off with a series of equal periodic payments |
Loan Amortization Table | Table used to calculate monthly payments |
Open-end Credit | Set payment period. Also, additional credit amounts can be added up to a set limit. It is a resolving charge account |
Outstanding Balance | Amount left to be paid on a loan |
Revolving Charge Amount | Charges for a customer are allowed up to a specific maximum, a minimum monthly payment is required, and interest is charged on balance outstanding |
Truth in Lending Act | Federal law that requires sellers to inform buyers, in writing of the finance charge and the annual percentage wage. The law does not dictate what can be charged |
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