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What is Debt?

Debt is an amount of money owed by one party to another party. Debt can be represented by a loan note, bond, mortgage or other agreement that usually states repayment terms and, if applicable, interest requirements.    See Also: How I Ditched My...

What is a Custodial Account?

A custodial account is an account created for the benefit of a minor at a financial institution that typically can only hold mutual funds or other similar investments.   See Also: Your DIY Financial Planning Guide Top 8 Mistakes Investors Make...

What is Credit Utilization Rate?

Credit Utilization Rate is an important factor used by credit bureaus when determining credit scores that is calculated by dividing the total of all outstanding balances by the total of all credit limits for each account. Generally, higher...

What is a Credit Score?

A credit score is a numeric representation of a person's creditworthiness determined by a statistical formula that calculates likelihood of debt repayment. The most common formula used is the FICO, or Fair Isaac Corporation, score formula.    See...

What is a Credit Report?

A credit report is a report that typically contains a person's credit score and detailed information on their financial history, including open and closed credit accounts, loans, bankruptcies, late payments and any recent credit inquiries. Credit...

What is a Credit Limit?

Credit limit is the maximum amount of credit that a financial institution is willing to extend to a customer.   See Also: How I Ditched My Debt For Good Is Your Debt Ratio Healthy? Ask An Advisor: Help! I'm Running Out of Money 5 Best Cash-Back...

What is a Credit Card?

A credit card is a tangible card issued by financial institutions to consumers for purchases using borrowed money that they are expected to pay back. Any balance not repaid in full by a specified period of time may be charged interest, typically...

What is a Credit Bureau?

Also referred to as a "consumer reporting agency," a credit bureau collects and sells information about the creditworthiness of individuals. A credit bureau consider's a person's spending habits and history and assigns them a credit score that can...

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