MoneyU Glossary of Terms
MoneyU Glossary of Terms
Browse the glossary using this index
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Credit Card Debt
The total unpaid balances on all your credit cards.
An organization that provides debt and money management advice and assistance to people with debt problems. Not all credit counseling firms are reputable, and some might actually make your debts and credit worse.
Factors used by lenders to rate the credit worthiness or ability to repay debt. This includes income, the amount of personal debt, the number of accounts from other credit sources, and credit history. A lender can use any credit-related information in approving or denying a credit application as long as they do not violate the Equal Credit Opportunity Act that prohibits credit discrimination on the basis of race, sex and other factors.
A record of how a consumer has paid credit accounts in the past. It is used as a guide to determine whether or not the consumer is likely to pay future accounts on time.
Credit Limit/Credit Line
Your credit limit is the maximum amount you may charge on a credit card or you can carry on an account. Some card issuers set a separate limit for purchases and cash advances. Many banks allow you to spend more than your credit limit, but charge you a fee for doing so. It is up to you to keep track of your credit limit and how much available credit you have left.
The way you handle the money you borrow from banks or credit issuers.
Credit Repair Organizations Act
Guidelines that credit repair services are required to follow in order to protect you.
An official record of a borrowerÔÇÖs credit history, including such information as the amount and type of credit used, outstanding balances, and any delinquencies, bankruptcies, or tax liens. A report that a prospective lender or employer obtains from a consumer reporting agency that displays the manner in which a consumer has met his or her past credit obligations. It is used to help determine creditworthiness of the potential borrower.
The risk that money loaned to another will not be repaid. Obligations of the U.S. Government are considered to have no credit risk.
A measure of creditworthiness based on an analysis of the consumerÔÇÖs financial history, often computed as a numerical score, using the FICO or other scoring systems to analyze the consumerÔÇÖs credit. A creditorÔÇÖs evaluation of a personÔÇÖs willingness and ability to pay debts as judged by character, capacity, and capital; a mathematical model used by lenders to predict the likelihood that bills will be paid as promised.