JARGON BUSTER

ADVERSE CREDIT

Adverse credit (also known as bad credit, impaired credit or poor credit) refers to a credit rating which shows a history of missing payments, and may include defaults and County Court Judgements (CCJs).

APPLICATION

Application - Is the information you provide to us in order for you to be considered for a loan.

APR

APR stands for Annual Percentage Rate and is used to describe the cost of borrowing money. All lenders calculate APR in the same way which allows you to compare different lending products.

ARREARS

Arrears are debts as a result of missed or late payments of a loan or other type of credit agreement. Falling into arrears can result in a poor or impaired credit history.

BAD CREDIT

Please see adverse credit.

BANKRUPTCY

Bankruptcy is an option that can be considered if an individual cannot pay the debts that they owe. It is a legal process which can seriously harm your ability to obtain credit in the future.

BASE RATE

The base rate is the interest rate set by the Bank of England for lending to other banks.

COUNTY COURT JUDGEMENT (CCJ)

A CCJ is a type of court order in England, Wales and Northern Ireland that may be registered against an individual if they fail to repay money that they owe.

CANCELLATION PERIOD

Cancellation/Cooling off period – Is a period of time following a purchase when you may choose to cancel the purchase.

CONSOLIDATION

Consolidation - Debt consolidation is a form of debt refinancing that means taking out one loan to pay off many other loans.

CREDIT HISTORY

Arrears are debts as a result of missed or late payments of a loan or other type of credit agreement. Falling into arrears can result in a poor or impaired credit history.

CREDITOR

An institution, like a bank or finance company that grants loans or provides goods on the basis of hire purchase. There must be legal contract (Credit Agreement) between the borrower and the Creditor which sets out how and when the money is to be repaid. In the case of hire purchase it will grant the lender the right to claim back the asset if you fail to pay back the loan. See Lender.

CREDIT AGREEMENT

A contract between you and a loan or finance provider which details the full terms and conditions and the total cost of your loan.

CREDIT CHECK

A check carried out by a lender to establish your credit worthiness. Arrears will be shown, along with details of your financial history, any adverse credit, electoral roll information and details of previous searches.

CREDIT RATING

Your credit rating is a summary of the information found in your credit report.

COLLATERAL

Collateral – Is money or property which is used to guarantee that you will repay a loan.

CREDIT BROKER

A credit broker, does not lend money, it works with a number of lenders to source loan options for you.