MoneyU Glossary of Terms

MoneyU Glossary of Terms

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Account Number

Every cardholder's account is identified by an account number. Protect it and never give it out over the telephone unless you initiated the call.


To prevent fraud, many card issuers require you to call them when you receive your new card in the mail to verify that the correct person has received it. Until proper ownership is confirmed, the card may not be activated.

Advance Fee Loan

A loan calculated so that all finance charges and other creditor expenses are deducted before the consumer receives the principal.

Annual Fee

Some credit card companies charge an annual fee; it is the yearly cost you pay to use the card.

Annual Percentage Rate (APR)

The APR measures the cost of credit expressed as a yearly interest rate.

Automatic Clearing House

The automated clearing house is how electronic transactions are processed when a person selects an electronic debit or credit of funds. These are most common with payroll direct deposit and automatic bill payments.

Automatic Payment

If you have a savings or checking account with the same bank that issues your card, you may be able to automatically transfer money from your bank account to pay a credit card bill. Automatic payment eliminates the risk of paying a bill late and being assessed a late charge.

Available Credit

The unused portion of credit that falls within the consumer's applicable credit limit, if any.

Average Daily Balance

(Including or excluding new purchases.) This is the most common method of calculating interest. To figure out your average daily balance, the bank adds up the amount you owe for each day of your billing cycle and divides that number by the number of days in the billing cycle (see Billing Cycle). New purchases may or may not be added to the balance, depending on the individual card's terms. The most favorable calculation excludes new purchases.


The amount of money you owe the card issuer. This includes purchases, fees, interest, and transaction charges.

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