Financial Terms Glossary...
A tax-deductible or tax-free retirement fund established by an individual to deposit savings until retirement. The savings contribution is regulated by federal statute.
Direct loans to individuals that are repaid in fixed, periodic payments.
The amount set for the use of money legally expressed as a rate for a period of time, usually one year, in which case it is called and expressed as an Annual Percentage Rate (APR) and Annual Percentage Yield (APY).
Account that carries the names of two or more persons who share equally in the rights and liabilities associated with the account. Either party can perform any transaction on the account. Only the primary member has loan privleges privileges under his or her member number.
Depositing and drawing checks on accounts at two or more financial institutions to take advantage of the float time; the time it takes the institution of deposit to collect from the paying institution. It is an illegal action.
The percentage of the payment due that is charged for being late or paying after the predetermined grace period.
Contract granting use of real estate, equipment, vehicle or other fixed assets for a specific time in exchange for payment, usually in the form of rent. The owner of the leased property is called the lessor and the user the leasee.
A creditor's claim against property. For example, a mortgage is a lien against a house. If the mortgage payments are not paid on time, the property can be
seized to satisfy the lien. Similarly, a bond is a lien against a company's assets. If the interest and principal are not paid when due, the assets may be seized to pay the bondholders. When the debt is paid, the lien is removed. Liens are often granted by courts to satisfy judgments.
Line of Credit (LOC)
Credit limit granted to a member or consumer on an open-end signature or home equity loan. The credit union makes a certain amount available to the member and he/she may draw funds up to that amount as deemed necessary. Liquid AssetCash or assets easily converted into cash with little or no loss of value.