Personal Finance

Annual Renewable Mortgage (ARM)

lets you lock in a period of "insurability", which is the length of time you will be able to renew the policy annually without reapplying or taking another medical exam

asset

property owned by a person or company, regarded as having value and available to meet debts, commitments or legacies

range of credit scores

300-850

Federal Deposit Insurance Corporation (FDIC)

a United States government corporation providing deposit insurance to depositors in US banks

endorsement

a clause in an insurance policy detailing an exemption from or change in coverage

lease

a contract by which one party conveys land, property, services, etc. to another for a specified time, usually in return for a periodic payment

mortgage

a debt instrument, secured by the collateral of specified real estate property, that the borrower is obliged to pay back with a predetermined set of payments

fixed rate

a fully amortizing mortgage loan where the interest rate on the note remains the same through the term of the loan

title

a legal document that supports or takes up an individual's right to ownership and possession of all items that can be recognized as being owned or belonging to a person or a thing

Secured Loan

a loan in which the borrower pledges some asset as collateral for the loan, which then becomes a secured debt owed to the creditor who gives the loan

Automated Teller Machine (ATM)

a machine that automatically provides cash and performs other banking services on insertion of a special card by the account holder

credit union

a nonprofit-making money cooperative whose members can borrow from pooled deposits at low interest rates

creditor

a person or company to whom money is owed

debtor

a person or institution that owes a sum of money

malpractice insurance

a type of professional liability insurance purchased by health care professionals (and sometimes by other types of professionals, such as lawyers)

term

a word or phrase used to describe a thing or two express a concept, especially in a particular kind of language or branch of study

CD Investment

among the safest investment a person can make, is determined ahead of time and you are guaranteed to get back what you put in, plus interest once this investment matures

line of credit

an amount of credit extended to a borrower

premium

an amount to be paid for an insurance policy

demand

an economic principle that describes a consumer's desire and willingness to pay a price for a specific good or service

Down Payment

an initial payment made when something is bought on credit

long term goal

anything over three years

three places you can get car loans

banks, credit unions, and auto finance companies

three types of endorsements

blank, special, and restrictive

collateral

something that you pledge as security for repayment of a loan, to be forfeited in the event of a default

three things that are included in the total costs of owning a car

taxes, registration fees, and maintenance

principal

the amount borrowed or the amount still owed on a loan, separate from interest

net pay

the amount of pay remaining for issuance to an employee after deductions have been taken from the individual's gross pay, amount paid to each employee on pay day

liquidity

the availability of liquid assets (cash) to a market or company

default

the failure to promptly pay interest or principal when due. occurs when a debtor is unable to meet the legal obligation of debt repayment

time value of money

the idea that money available at the present time is worth more than the same amount in the future due to its potential earning capacity

compounding interest

the interest calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan

Annual Percentage Rate (APR)

the interest rate for a whole year rather than just a monthly fee/rate, as applied on a loan, mortgage loan, credit card, etc.

minimum balance

the least amount of money that you can pay on your credit card each month, and if you only pay this each month it might be a while before it is paid off

opportunity costs

the loss of potential gain from other alternatives when one alternative is chosen

point of sale transaction

the point where a transaction is finalized or the moment where a customer tenders payment in exchange for goods and services

grace period

the provision in most loan and insurance contracts which allows payment to be received for a certain period of time after the actual due date

gross pay

the total amount of money you get before taxes or other deductions are subtracted from your salary

easy way to find total interest paid

when you subtract the principal, the amount of money borrowed, from the total amount you paid, you get the total interest paid

cosign

you have agreed to become obligated to repay the amount of the loan if the primary borrower does not

interest

you usually get this when you put principal in a bank

comprehensive insurance

your insurance company pays for damage to your auto caused by an event other than a collision, such as fire, theft, or vandalism