Jargon Buster
Lost in all the jargon, here's some help on Domestic Appliance Repairs, Financial and Mobile Phone / Mobile Broadband - services found on the clickyoucan.com site!
- Adverse Credit
is a term for people who have a history of defaulting on credit repayments, have county court judgements or have been declared bankrupt.
- APR (Annual Percentage Rate)
the total amount of interest and other fees charged on a loan.
- Arrears
when a borrower has fallen behind on loan or mortgage repayments.
- Bankruptcy
with personal bankruptcy, creditors agree part repayment of all outstanding debts, and when the agreed repayment has been met, the bankrupt has a 'clean slate'. Currently the restrictions last for three years and there are implications that need to be discussed with a qualified insolvency practitioner: care need s to be taken in selecting help since this market is open to exploitation by high upfront fees.
- Bad Credit
common practices that can damage a credit rating including making late payments, exceeding card limits, declaring bankruptcy and making multiple applications for credit.
- Broker
an individual who sources financial products best suited to an individual's needs.
- Cashback
an incentive whereby the borrower receives back a sum of money when taking out a loan.
- CCJ (County Court Judgement)
a court order against a borrower demanding that they pay back money owed.
- Credit Agreement
a signed agreement between the lender and borrower, outlining terms and conditions relating to the loan.
- Credit Reference Agency
a company that provides lenders with individuals' credit details and history.
- Credit Score
an applicant's credit status based on searches carried out by credit reference agencies.
- Debt Management
a service and process offered to people who are having problems with debt. Care needs to be taken with companies offering this service because high fees can be charged often exploiting people who need help.
- IVAs -Individual Voluntary Arrangements.
This is an option for people who have £20,000 of credit with 4 or more creditors to have an insolvency practitioner negotiate with the creditors to reduce the debts outstanding. Care needs to be taken in selecting companies to do this because often people who need help are exploited by high up front fees.
- Mortgage
this is a financial product that allows you to buy a property - and gives the lender a first charge on the property (protecting them if you default on payments).
- Fixed Interest Rates
an interest rate that remains the same throughout the loan term.
- Over -repayments
when payments are higher or more frequent than stipulated in the credit agreement.
- Payment protection
an insurance plan that will take care of loan repayments on your behalf in the event of illness or redundancy
- Remortgage
is a financial product that allows you to refinance by releasing equity in your property if it has risen in value since it was originally purchased. Remortgaging can be used to find a lower rate of interest (saving you money) or to consolidate all your loans into this single financial commitment which should be a lower rate than the rates of interest of the individual loans - e.g. car loan, credit card loans, store cards and bank loans - it should prove to be a lower interest rate and more manageable repayments
- Secured Loan
where a borrower's property is used as security to guarantee repayment of the loan. This is a second charge on the home, utilising the equity in the property by placing a second charge a- behind the current mortgage.
- Self -certification
where the loans company allows the application to state his income without providing evidence.
- 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.
- Under-repayments
when payments are lower or less frequent than stipulated in the credit agreement, often authorised by the lenders if the borrower is struggling to make repayments but is committed to making some contribution until the situation improves.
- Underwriting
the assessment made by a lender to decide whether to approve a loan application.
- Unsecured Loan
a loan that does not require the borrower to use his or her home as security - BUT be aware: if the borrower defaults on several occasions, the lender is able to enforce some degree of claim on the borrower’s property if they are a home owner.
- Variable Rate Interest
an interest rate that will fluctuate throughout the loan term, either up or down depending on market forces.