APRAn APR (Annual Percentage Rate) is the interest associated with a loan expressed as an annual rate.
ACHACH (Automated Clearing House) is a type of payment that is automatically credited to or debited from your bank account.
Affiliate marketers are individuals or entities who earn a commission by promoting someone else’s products or services.
Amount FinancedThe actual amount of credit made available to a borrower in a loan.
Bank PartnershipAn arrangement where a lender partners with a bank. Typically, these lenders relay loan applications to their bank partner, who actually funds the loan. Usually, the bank then sells the loan back to the lender, meaning that the original company that accepted the application still ends up servicing the loan.
Billing CycleThe length of time between the last closing date and the next in a regular periodic financial statement.
BorrowerA person or entity that takes out a loan from another party under an agreement to pay it back at a later time, usually with interest and/or fees.
Business DayAny day in which normal business hours are conducted. This excludes weekends and holidays.
CollateralSomething pledged by a borrower as security for repayment of a loan, which is forfeited in the event of a default.
Consumer LoanA loan made to an individual borrower for personal use, as opposed to a loan made to an individual or entity for commercial/business use.
Credit BureauA business that collects information relating to the credit quality of individuals and makes it available to financial institutions. The traditional three major credit bureaus in the United States are Experian, Equifax, and Transunion. LendSwift relies on alternative credit bureaus rather than these three.
Credit CheckAn official review of an individual’s credit history maintained by a credit bureau or other business or institution.
Credit HistoryA credit history is a record of how a person has managed and repaid credit extended to them in the past. It is used to gauge a borrower’s ability to repay future credit obligations.
Credit LimitA credit limit is the maximum amount of funds that a financial institution will extend to a borrower for a specific line of credit.
Credit LineA credit line is a form of credit extended to a borrower by a financial institution that allows the borrower to draw funds as needed up to the specified credit limit.
Credit ScoreA credit score is a number based on an analysis of the information on a borrower’s credit report that seeks to represent how creditworthy he or she is. Traditional credit scores are generally based on an individual’s credit reports maintained by the three major credit bureaus (Experian, Equifax, and Transunion.)
Credit ReportA credit report is a breakdown of a borrower’s credit history that is prepared and issued by a credit bureau.
DefaultA default is a failure on the part of an individual to fulfill the promises or obligations he has made as part of an agreement. A borrower is considered to be in default on a loan if he or she fails to repay the loan as agreed.
DelinquencyA situation where a borrower is late or overdue on a loan payment.
Direct DepositA direct electronic payment into a recipient’s bank account.
Direct LenderA financial institution that actually provides a loan directly to the borrower, as opposed to an entity that advertises a loan but does not actually fund the loan advertised.
Daily Periodic RateA daily periodic interest rate is the amount of interest or fees charged by a lender on each day a loan is active. It is generally used to calculate interest by multiplying the rate by the amount owed at the end of each day.
DrawA withdrawal of cash from a line of credit.
Due DateThe date on which a payment is due to be paid according to the terms of a loan agreement.
FICO ScoreA FICO score is a credit score calculated by the Fair Isaac Corporation (FICO). This score, like other credit scores, is a number based on an analysis of the information on a borrower’s credit report that seeks to represent how creditworthy the borrower is.
Finance ChargeThe cost of borrowing money, including interest and fees.
Good StandingThe status of a borrower’s account when all terms and conditions (including successful and timely repayment) of a loan agreement have been adhered to.
Installment LoanA loan that is repaid in regularly scheduled payments (installments) over a period of time.
InterestInterest is the amount charged on top of a loan’s principal by a lender to a borrower for the use of the funds.
Interest RateThe proportion of a loan that is charged as interest to the borrower. This is usually expressed as an annual percentage rate (APR) of the loan outstanding.
LenderA person or entity that advances funds to a borrower pursuant to an agreement that the funds will be repaid at a later time, usually with interest and/or fees.
Line of CreditA line of credit is a flexible loan from a financial institution that consists of a defined amount of money that you can access as needed and repay either immediately or over time.
LoanAn amount of money that is borrowed pursuant to an agreement that it will be repaid at a later time, usually with interest and/or fees.
Loan AgreementA contract between a lender and a borrower that dictates the terms and conditions of a loan.
Loan TermThe period of time between a loan’s effective date and the date when it is due to be fully repaid.
Minimum PaymentA minimum payment is the lowest amount a borrower can repay on a scheduled date to remain in compliance with a loan agreement.
Outstanding BalanceThe unpaid balance of a loan.
Payment ScheduleA schedule that defines the dates at which payments are to be made by a borrower to a lender to satisfy the terms of a loan agreement.
PrincipalThe original amount of a loan.
Principal PaymentA payment toward the outstanding principal of a loan.
Secured LoanA loan where the borrower pledges an asset as collateral for the loan, which is forfeited to the lender in the event of default.
Truth in Lending Act (TILA)A 1998 federal law designed to promote informed borrowing and transparent lending.
Unsecured LoanA loan where the borrower does not pledge collateral as part of the loan agreement.