Financial Terms VHS

garnishing

A wage garnishment is when a court issues an order requiring your employer to withhold a certain amount of your paycheck and send it directly to the person or institution to whom you owe money, until your debt is paid off

bankruptcy

A legal process to get out of debt when you can no longer make all your required payments

closed-end credit

A loan for a specific amount that must be repaid in full, including all finance charges, by a stated due date.

collateral

a borrower's pledge of specific property to a lender, to secure repayment of a loan

open-end credit

credit as a loan with a certain limit on the amount of money you can borrow for a variety of goods and services

unsecured loans

loans backed only by the borrowers' good reputation and previous credit rating

secured loans

loans backed up with assets that the lender can claim in case of default, such as a piece of property

liquidation

wipes out all allowable debts and allows certain personal property exemptions