Copy of `My PayDay - Payday loans info`

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My PayDay - Payday loans info
Category: Economy and Finance > Payday loans
Date & country: 27/01/2011, UK
Words: 66


ACH
Automated Clearing House; manages electronic cash transactions, which in the UK are processed by BACS Ltd.

AER
Annual Equivalent Rate.

APR
Annual Percentage Rate; includes arrangement fees and any other charges as well as the monthly interest over the life of a loan.

Arrangement fee
a charge to cover administration costs.

Arrears
overdue payments.

Assets
anything of value that you own.

BACS Ltd
Bankers Automated Clearing Service, owned by a group of financial institutions, it manages electronic cash transactions.

BACS Payment
an instruction to electronically credit a payee's account with a specified amount.

Banker's draft
a secure way of transferring large amounts of money similar to a cheque.

Base rate
the interest rate set by the Bank of England. Lenders use it as the basis to set their own interest rates.

Capital
the amount of money invested or borrowed, not including income or interest.

CHAPS
Clearing House Automated Payment System; enables same day transfer of funds from one account to another.

Chip and PIN
introduced to reduce credit and debit card fraud. A "smart" chip on the card records your PIN (Personal Identification Number) which must be entered on a keypad when the card is used to withdraw cash from an ATM or used to pay for goods.

Cleared balance/cleared funds
cash or cheques that have been processed through the clearing cycle to arrive in your account.

Clearing cycle
the process of verifying funds have reached your account.

Credit balance
the amount of money in your account.

Credit card
used to pay for goods and services up to an agreed credit limit.

Credit limit
the maximum amount you may owe to your credit card company.

Credit report
a record of your credit history based on information from credit card companies, banks and the Courts.

Debit card
used to pay for goods and services by debiting your bank account.

Debt
any amount of money owed to an individual or company.

Debt Consolidation
remortgaging or taking a new loan in order to repay other debts or loans.

Discounted rate
a reduced mortgage rate set at a certain percentage below the standard variable rate for a fixed length of time after which it reverts to the lender's standard rate.

EAR
Effective Annual Rate; the interest charged on a bank overdraft not including any fees.

Equity (in property)
the difference between the value of your property and what you owe in the form of an outstanding mortgage or other debts secured on the property.

Equity release
a way to raise money by borrowing against the equity in your property.

ERTF
Exchange Rate Transaction Fee; charged for withdrawing foreign currency from an ATM or paying in a foreign currency whilst abroad.

Fixed
rate interest loan or savings interest rate that remains the same over an agreed length of time.

Flexible mortgage
a mortgage with allowances to underpay or overpay without being penalised.

Further advance
an agreed extension to an existing mortgage.

Gross
the entire amount before deductions.

Gross interest rate
the rate before tax deductions

Guarantor
a person who has agreed to guarantee mortgage repayments for someone who does not have enough income to obtain a mortgage themselves.

Insurance policy
a policy that you pay for, and that pays money to you to cover possibilities such as theft, damage to property, loss and so on.

Interest
only mortgages loans for which the capital owed remains the same throughout the loan period and only the interest is paid. This means that the capital must be repaid at the end of the loan period.

Interest
the extra paid back when you borrow money, usually expressed as an annual percentage.

Interest rate
the rate, expressed as an annual percentage, at which interest is paid on a loan.

Investment
something you buy to provide a return in the future.

Lifetime mortgage
a method of equity release for over 60s. You borrow money against the equity in your home, you pay no monthly payments but the interest is added to the loan amount. This is repaid by the sale of the house when you die or move into care.

Loan
money given to you which you agree to pay back sometime in the future.

Loan period
the time allowed to pay back the loan.

Mortgage
a loan to buy property with certain conditions attached. If you do not keep up your payments the lender has the right to sell the property to recoup the loan.

Net
the amount after tax and other deductions.

Net interest rate
the interest rate payable after the lower rate of income tax is deducted.

Online Banking
banking operations performed on the internet.

Outstanding
the amount outstanding is the amount of a loan you still have left to pay.

Overdraft
an amount borrowed on a current account by agreement with your a bank or building society

Overpayment
a payment to your mortgage lender greater than the agreed amount in order to pay off the loan earlier.

p.a.
"per annum" which is Latin for "each year".

Personal Loan
a loan to a private individual from a bank or other financial institution.

PIN
Personal Identification Number; the number you use when you pay for goods and services with a "chip and pin" card.

Rate
the annual percentage charged on a loan.

Remortgage
to negotiate a new mortgage on your existing home.

Repayment method
how you repay your mortgage, either "repayment" or "interest only".

Repayment mortgage
an arrangement to repay some of the capital of the loan each month as well as the monthly interest payment.

Return
the profit from an investment.

Share
a unit of company ownership.

Share certificate
proof of ownership of a company's shares.

Share dealing
the buying and selling of shares.

Standing order
instruction to your bank or building society to pay regular fixed amounts.

Stock
a unit of company ownership.

Transaction
paying money into or taking money out of an account.

Unarranged borrowing
allowing your overdraft to exceed the agreed amount.

Uncleared balance
the balance of your account including any uncleared funds.

Unsecured loan
most personal loans are "unsecured", meaning they do not require collateral.

Variable
rate interest an interest rate that rises and falls to follow the "base rate" set by the Bank of England.