Glossary

Amortization
Loan payment calculated to pay off the debt at the end of a fixed period, including interest on the outstanding balance.

Annual Percentage Rate (APR)
Cost of credit as a yearly rate, the percentage results from an equation considering the total amount financed, the finance charges and the term of the loan.

Appraisal
An estimate of the value of property, made by a professional appraiser.

Appraisal Fee
The charge for estimating the value of property.

Asset
Property that can be used to repay debt, such as stocks and bonds or a car.

Cosigner
A person who signs your loan and assumes equal responsibility for it.

Credit
Right granted by a creditor to pay in the future in order to buy or borrow in the present; also, a sum of money owed to a person or business.

Credit Bureau
An agency that keeps one’s credit record.

Credit History
The record of how you’ve borrowed and repaid debts.

Credit Scoring System
A statistical system used to rate credit applicants according to various characteristics relevant to creditworthiness.

Term
The period of time between the beginning loan date on the legal documents and the date the entire balance of the loan is due.

Title
Document that gives evidence of an individual’s ownership of property