Financial Terms Glossary...
Corporate Credit Union
A federal or state-chartered credit union that serves other credit unions, providing investment, short-term (liquidity) loans and other services to its member credit unions.
A creditworthy third party who also assumes responsibility for repaying a loan in the event the primary borrower does not make the specified payments.
Correspondent Credit Union
When a credit union acts as an agent and processes transactions for members of another credit union pursuant to a service agreement between the institutions.
Companies that track and report how members and consumers repay or fail to repay money they have borrowed. The information is regularly recorded and updated and becomes the member's or consumer’s credit history.
Verifying debt, payment history, and income with the member's or consumer's employer(s).
A group of credit union volunteers responsible for approval or disapproval of member loan applications.
Credit Disability Insurance
Insurance that pays loans and bills for a set time in case of a prolonged illness or accident.
Continual record of a borrower’s debt commitments and payment record.
Credit Life Insurance
Insurance that will pay off the loan balance during the term of the loan if the member dies. The two types of insurance include Single life which pays the loan balance for the member and Joint life which pays the loan balance if a member or his/her spouse dies.
Total amount of funds available to a member or consumer, such as with a credit card or line of credit limit.
A numerical formula that represents of a member's or consumer’s credit history. The scoring system is used by lenders to determine whether or not they will advance credit or approve a loan.
Member-owned, not-for-profit financial cooperative that provides higher yield saving and lower interest loan opportunities at highly competitive rates. Credit unions also provide money management services. Members are united by a common bond of association, such as an employment, organization membership or community residency. The insitutions are democratically operated under state or federal regulation.
Credit Union Membership Access Act (H.R. 1151)
Signed into law by President Clinton on August 7, 1998. The Credit Union Membership Access Act overturned a 1998 Supreme Court decision against credit unions and consumers that limited who could join a credit union. The act preserves the right of consumers to choose a financial institution.