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Glossary

2-1-1.org

2-1-1 is an easy-to-remember three-digit telephone number meant to provide information and referrals to health, human and social service organizations. Health and human service information can also be accessed on the 2-1-1 website, www.211.org

30/60 Day Notice to Vacate

A notice from a landlord to a tenant to vacate the premises. Some states allow landlords to give tenants 30 days notice, while other states require 60 days. If a tenant fails to vacate the premises within 30 or 60 days of the landlord’s notice to vacate, the landlord may bring an unlawful detainer or eviction suit, and a court may order the tenant to vacate.

account balance

The total amount of money owed to a third party such as a credit card company, utility company, mortgage banker or other type of lender or creditor.

adverse action

An action that denies an individual or business credit, employment, insurance or other benefits. An adverse action is generally taken by a business or government based on a criminal past or information found in credit reports.

alternative financial services

a term used to describe the array of financial services offered by providers that operate outside of federally insured banks and credit unions.

AnnualCreditReport.com

AnnualCreditReport.com is the official website to get a free credit report. The site is maintained by Central Source, LLC, which is sponsored by Equifax, Experian and TransUnion. It provides a single site where you can download credit reports from all three companies.

application fee

Rental application fees are used to pay for a credit check and any other tenant screening processes the landlord requires.

ATM withdrawl

Cash withdrawl from a savings or checking account via an electronic banking outlet, which allows customers to complete basic transactions without the aid of a branch representative or teller.

auto loan

An auto loan is a loan used to finance the purchase of an automobile. It is usually unsecured and based on the borrower’s integrity and ability to pay.

auto transfer

An automatic transfer of funds between customer accounts. For example, a regular transfer from a checking account to pay off a bank loan, or a monthly transfer from a checking account to a savings account.

automatic bill pay

Routine payments made from a banking, brokerage or mutual fund account to vendors.

available credit

The difference between the amount of the credit line or limit, and the amount that has already been borrowed. Available credit is considered readily available for withdrawal or for direct purchases.

Bank

A bank is an establishment authorized by a government to accept deposits, pay interest, clear checks, make loans, act as an intermediary in financial transactions, and provide other financial services to its customers.

bank account

An account maintained by a financial institution for a customer. The account represents the funds that a customer has entrusted to the financial institution and from which the customer can make withdrawals. Alternatively, accounts may be loan accounts in which case the customer owes money to the financial institution.

Bank account balance

The amount of money in a financial repository, such as a checking account, at any given moment.

Bank account garnishment

Bank account garnishment is a technique that is used to recover money from people with substantial outstanding debts. Garnishment occurs after a legal judgment against the debtor occurs, and is done by issuing a bank with a court order that forces them to freeze a debtor’s account or accounts, and to withdraw enough funds to satisfy the legal judgment. If the debtor’s account does not contain enough money to satisfy the judgment, he or she will be liable for the remaining balance.

banking history report

A report of your previous banking activity that is generated by a consumer credit reporting agency such as ChexSystems, TeleCheck, or Early Warning Systems.

bankruptcy

Bankruptcy is a generalized term for a federal court procedure that helps consumers and businesses get rid of their debts and repay their creditors. Among the different types of bankruptcies, Chapter 7 and Chapter 13 proceedings are the most common for individuals and businesses. Chapter 7 bankruptcies take and sell any property or assets you might own in order to pay back your debts. Chapter 13 bankruptcies allow you to keep your property, but you must submit and stick to a plan that will allow you to repay some or all of your debts within three to five years.

bounced check

A “bounced check” is slang term for a check that cannot be processed because the writer has insufficient funds. A bounced check will often be returned to the writer along with a penalty fee for non-sufficient funds.

business loan

A loan specifically intended for business purposes. As with all loans, it involves the creation of a debt, which will be repaid with added interest.

canceled check

A canceled check is a check that has cleared the depositor’s account and has been marked as “canceled” by the bank. A canceled check has been paid by the drawee bank and endorsed by the payee, the payee’s bank, and the Federal Reserve Bank.

car title loan

A short-term loan in which the borrower’s car title is used as collateral. The borrower must own the car outright. Loans are usually for less than 30 days. Borrowers must temporarily surrender the hard copy of their vehicle title in exchange for a loan amount. When the loan is repaid, the car title is returned to its owner. If the borrower defaults on their payments then the lender is liable to repossess the vehicle and sell it to repay the borrowers’ outstanding debt.

Career One-Stop Centers

One-Stop Career Centers are designed to provide a full range of assistance to job seekers under one roof. Established under the Workforce Investment Act, the centers offer training referrals, career counseling, job listings, and similar employment-related services.

cash flow budget

An estimation of the cash inflows and outflows for a specific period of time. Cash flow budgets are often used to assess whether the entity has sufficient cash on hand to meet expenses.

cashier's check

A check guaranteed by a bank, drawn on the bank’s own funds and signed by a cashier. Also known as a bank check.

Catholic Charities

A network of more than 160 local non-profit agencies nationwide that work to reduce poverty in America. They provide services housing, health care, disaster relief, and other services to millions of people annually.

certified mail

Certified Mail allows the sender proof of mailing via a mailing receipt and, upon request electronic verification that an article was delivered or that a delivery attempt was made. The return receipt is a green postcard-sized paper that is mailed back to the sender by the post office upon receipt by the addressee as proof of delivery.

Charge Card

A card that charges no interest but requires the user to pay his/her balance in full upon receipt of the statement, usually on a monthly basis.

Charge-off

A charge-off is the declaration by a creditor that an amount of debt is unlikely to be collected. This occurs when a consumer becomes severely delinquent on a debt. The creditor considers the remaining balance to be bad debt, but borrowers are still obligated to repay the outstanding debt. After an account is charged off by the original lender it is usually sent to a collection agency. The collection agency will then attempt to recover the remaining amount and potentially additional interest and fees.

check

A written order directing a bank to pay money as instructed.

check casher

A company that will cash a check for a fee. The fee is generally a percentage of the amount of the check that is cashed.

Checking account

A checking account is a deposit account held at a financial institution that allows for withdrawals and deposits. Money held in a checking account can be withdrawn using checks, automated cash machines and electronic debits, among other methods.

ChexSystems

ChexSystems is a check verification service and consumer credit reporting agency owned by a subsidiary of Fidelity National Information Services. It provides information about the use of deposit accounts by consumers.

Child and Dependent Care Tax Credit

A non-refundable tax credit for unreimbursed childcare expenses paid by working taxpayers. The Child and Dependent Care Credit is designed to encourage taxpayers to pay childcare expenses so that they can remain gainfully employed.

Child Tax Credit

A nonrefundable credit that reduces the taxpayer’s liability on a dollar-for-dollar basis. The Child Tax credit is intended to provide an extra measure of tax relief for taxpayers with qualifying dependents.

co-signer

The act of signing for another person’s debt. The co-signer is legally obligated to make payment on the other person’s debt should that person default.

collateral

Something of value, like a home, boat or car that is pledged as security for repayment of a loan, to be forfeited in the event of a default.

collections

The process of recouping a debt that is delinquent or past-due.

community action agencies

Non-profit organizations that provide services, assistance, and other activities designed to eliminate poverty.

community resources

Cash, goods, or services provided to qualifying members of a community, but generally those experiencing financial hardship, whether long-term or temporary.

community-based organizations

A community-based organization is a public or private nonprofit that is representative of a community or a significant segment of a community, and is engaged in meeting human, educational, environmental, or public safety needs.

consumer reporting agency

Consumer reporting agencies collect information and provide reports to other companies about consumers. Companies use these reports to make decisions about providing credit, employment, residential rental housing, and insurance.

credit building loan

A combination loan and savings program that helps to establish a good payment history and increase one’s credit score. Credit building loans place the money you borrow in a certificate of deposit (CD) that earns interest. The borrower makes monthy principal and interest payments to repay the amount borrowed. After the final payment is made, the borrower can withdraw the funds or leave them invested in a CD.

credit bureau

An agency that researches and collects individual credit information and sells it for a fee to creditors so they can make a decision on granting loans.

Credit card

A short-term borrowing instrument that allows a customer to make a purchase now and pay later, normally with interest and fees. The credit card issuer sets a maximum limit that can be charged. Borrowers make monthly payments on the amount charged to the account, as well as on the interest that is charged by the issuer. When payments are made, those funds become available for borrowing again. Credit cards are considered a form of revolving credit since the amount borrowed fluctuates and is not repaid in a set number of payments.

credit card billing cycle

Credit card companies define billing periods or cycles to figure out how to issue bills and charge interest. The billing cycle has a specific number of days with a closing date that ends the billing cycle. After the closing date of one billing cycle, the next one begins. Credit card companies use the beginning and closing dates of a billing cycle to calculate interest on a balance.

credit check

The process of evaluating an applicant’s loan request in order to determine the likelihood that the borrower will repay his debt.

credit history

A credit history is a record of a borrower’s responsible repayment of debts.

Credit inquiry

A transaction where a bank or other credit-issuing institution views an individual’s credit report. The purpose of a credit inquiry is to evaluate an individual’s likelihood to repay money that is lent to them. There are two main types of credit inquiries - a “soft” inquiry and a “hard” inquiry. A soft inquiry is normally initiated by an individual (such as checking one’s own credit report for errors) and is not recorded on the individual’s credit report. A hard inquiry is recorded on an individual’s credit report when a third party views the credit report in response to an application for credit.

credit limit

The maximum amount of credit that a financial institution or other lender will extend to a debtor. Sometimes called a credit line, line of credit, or a tradeline. Credit limits are usually determined based on information contained in the application of the person seeking credit, or that person’s credit rating.

Credit report

A credit report is a document supplied by a bank or a credit reporting agency that summarizes an individual’s credit history and present financial position, including any pending judgment(s) against the individual.

credit reporting agency

Credit reporting agencies are businesses that maintain historical information pertaining to credit experience on individuals or businesses. The data are collected from various sources, most commonly firms extending credit such as credit card companies, banks and credit unions.

Credit Score

A credit score is a numeric expression of a person’s creditworthiness that is used by lenders to assess the likelihood that a person will repay his or her debts. It is based on a person’s past credit history and ranges from 300 to 850. The higher the number, the more creditworthy the person is deemed to be.

credit terms

Terms offered by the credit issuer to the applicant that control (1) the monthly and total credit amount, (2) maximum time allowed for repayment, (3) discount for cash or early payment, and (4) the amount or rate of late payment penalty.

Credit Union

A credit union is a non-profit, member-owned financial institution. They are created and operated by members, who can borrow from pooled deposits at low interest rates.

credit utilization rate

The percentage of a consumer’s available credit that he or she has used. It is calculated by adding together the outstanding balances of all one’s credit cards and then dividing that amount by the sum of each card’s limit.

Criminal conviction

A finding by a judge or jury that a person is guilty of a particular crime or charge. This judgment can come by way of a plea of guilty or a finding after a trial.

Cure or Quit Notice

A notice to cure or quit is issued by a landlord when a tenant performs actions in violation of a lease. The notice gives a tenant the option of either fixing the offending problem or vacating the rental property.

current debt

The portion of all total debt that must be paid within a year.

debit card

A card issued by a bank allowing the holder to transfer money electronically to another bank account when making a purchase.

debit transaction

A withdrawal of funds from an account, such as a cash withdrawal, bill payment or fund transfer.

debt trap

A situation in which a debt is difficult or impossible to repay, typically because high interest payments prevent repayment of the principal.

debt-to-income ratio

A personal finance measure that compares an individual’s debt payment to his or her overall income. It is calculated by dividing all monthly debt payments by monthly gross income.

deduction

Any item or expenditure that is subtracted from gross income to reduce the amount of income that is subject to tax.

deed-in-lieu of foreclosure

A potential option taken by a borrower to avoid foreclosure under which they deeds the property back to the lender in exchange for the release of all obligations under the mortgage.

defined benefit plan

A defined benefit plan, also called a pension, is an employer-sponsored retirement plan. Benefits are paid monthly upon retirement and are calculated based such factors as salary history and length of employment.

defined contribution plan

A type of retirement plan in which the employer, employee or both make contributions on a regular basis. Individual accounts are set up for participants and benefits are based on the amounts credited to these accounts (through employer and employee contributions) plus any investment earnings on the money in the account.

delinquent

Overdue in payment.

department store charge card

A credit card issued by a retail store, which can only be used for purchases in that store.

deposit

A sum of money placed or kept in a bank account.

direct deposit

The electronic transfer of a payment directly from the account of the payer to the recipient’s account.

disability insurance

A type of insurance that replaces income lost due to illness or injury. Most disability insurance policies pay a fixed sum for a fixed period, while others pay a monthly sum for the entire period the insured is not able to earn an income (as determined by his or her qualifications, experience, and training).

Early Warning

Early Warning is a nationwide specialty consumer reporting agency owned and governed by seven of the largest banks in the United States. Financial Service Organizations and others FSOs contribute transactional data to protect the financial system from fraud and abuse.

Earned Income Tax Credit

A refundable tax credit for low- to moderate-income working individuals and couples, particularly those with children. The amount of EITC benefit depends on a recipient’s income and number of children. Because the tax credit is refundable, if the amount of the credit is more than the taxpayer owes in taxes, they will receive the difference in the form of a refund.

Earnings

Money received as compensation for labor.

Education Tax Credit - American Opportunity Credit

A tax credit that enabled more student and parents to pay for part of their college expenses in the 2009 and 2010 tax years by expanding the existing Hope tax credit.

electronic funds transfer payment

Electronic Funds Transfer is the transfer of money from one bank account to another, either within a single financial institution or across multiple institutions, through computer-based systems and without the direct intervention of bank staff.

emergency fund

An amount of money set aside for use in an emergency, such as the loss of a job, an illness or a major expense.

emergency rental assistance agencies

Non-profit organizations that will provide you with emergency rental funds so you can stay in the rental that you already live in. Most of the time funds are paid directly to the landlord. You may have to provide proof of residence and financial need.

emergency savings fund

An account that is used to set aside funds for an emergency, such as the loss of a job, an illness or a major expense.

employee benefits

A form of compensation paid by employers to employees over and above regular salary or wages. Employee benefits come in many forms and are an important part of the overall compensation package offered to employees.

Equifax

Equifax is a consumer credit reporting agency in the United States, considered one of the three largest American credit agencies along with Experian and TransUnion

eviction

When a renter or tenant is forced to move out by a property owner.

Experian

Experian is a consumer credit reporting agency in the United States, considered one of the three largest American credit agencies, along with Equifax and TransUnion.

Fair Credit Reporting Act

The Fair Credit Reporting Act is is the act that regulates the collection of credit information and access to your credit report. It was passed in 1970 to ensure fairness, accuracy and privacy of the personal information contained in the files of the credit reporting agencies.

faith-based organization

An organization based on a particular religious ideology. It has a religiously-oriented mission statement and its leaders, staff, and volunteers share the same ideology.

Federal Fair Housing Laws

Federal Fair Housing Laws prohibit discrimination in the sale, rental, and financing of property, and in other housing-related transactions, based on race, color, national origin, religion, sex, familial status (including children under the age of 18 living with parents of legal custodians, pregnant women, and people securing custody of children under the age of 18), and handicap (disability).

federal government

The United States Federal Government was established by the Constitution and is divided into three branches: the executive, the legislative, and the judicial. There are 15 government departments that administer policies enacted by Congress, collect revenue in the form of taxes, administer programs that improve the welfare of US citizens, and protect and defend US borders.

federal income tax

A tax imposed by the United States federal government and collected by the Internal Revenue Service (IRS). Individuals, corporations, trusts, and all other legal entities must pay income taxes. Federal income taxes are applied on all forms of earnings that make up taxable income, such as employment earnings or capital gains.

federally insured bank

The funds depositors place in banks are insured by the Federal Deposit Insurance Corporation (FDIC), an independent agency of the United States government. FDIC insurance is backed by the full faith and credit of the United States government.

fees

A payment made in exchange for advice or services.

FICO

FICO, or Fair Isaac Corporation, is the largest and best known of several companies that take infomration from credit bureaus and use it to calculate a person’s credit score.

field of membership

Defines the characteristics of the people or entities that a credit union can legally serve.

file a dispute

The process of protesting false or incorrect information or charges with your bank, credit card company, and/or on your credit or banking history report.

finance company

Financial organization that accepts deposits (and pays out interest on them) and lends to consumers and/or businesses.

financial fraud

An intentional act of deception involving financial transactions for purpose of personal gain

forbearance

The action of refraining from exercising a legal right, especially enforcing the payment of a debt.

foreclosure

The process of claiming property when a homeowner is unable to make full principal and interest payments on his/her mortgage. This allows the lender to seize the property (the collateral), evict the homeowner and sell the home, as stipulated in the mortgage contract.

foreclosure proceedings

Legal proceedings initiated by a lender in the case of mortgage default. When a borrower fails to make mortgage payments or otherwise fails to fulfill any of the obligations set forth in the mortgage agreement, the lender can enforce its rights through a foreclosure.

foreclosure rescue scams

Individuals or organizations that claim to be able to help homeowners avoid foreclosure. They generally charge high fees for their services and either provide little to no help to the homeowner, or cheat them out of their home. One common scam is to offer the homeowner a lease-back provision, where they rent the house with the right to buy it back after a certain period. But usually the rent is higher than the mortgage and the repurchase price is so inflated that the homeowner either is evicted for not paying rent or can’t afford the repurchase price and loses the house. In other cases, the consultant tells the homeowner he or she will be able to buy the home back after signing the deed, but then adds on so many fees and costs that it becomes impossible.

foreclosure specialist

Foreclosure specialists help homeowners at risk of losing their house due to non-payment of their mortgage. A foreclosure specialist can determine if the owner is eligible for a restructured loan to save the property.

fraud

Fraud is wrongful or criminal deception intended to result in financial or personal gain.

Fresh Start Accounts

Checking accounts for people that have been restricted from opening a checking account due to a ChexSystems record or previous account mismanagement. These accounts may come with different fees or restrictions than traditional checking accounts. You may also be required to complete financial education before you may open a fresh start account.

full-time job

A full-time job is one in which a person works a minimum number of hours defined by his/her employer. Companies commonly require from 35 to 40 hours per week to be defined as full-time.

good will deletion

The practice of asking your lender, a credit report data furnisher, to remove an accurate, but negative, credit file entry. A goodwill deletion is most successful for low-level delinquencies, such as a 30-day late payment.

Government-issued photo identification

Government-issued photo identification allows a person to verify that he is who he claims to be. The types of ID come in different form, but they are usually issued by a state or federal agency. Common forms of government-issued photo identification include state driver’s licenses, U.S. military ID, U.S. passports, permanent resident cards, and foreign government-issued passports.

gross pay

All of the money you’ve made while working at your job, before any deductions are taken for state and federal taxes, Social Security and health insurance.

health insurance

A type of insurance coverage that pays for medical and surgical expenses that are incurred by the insured. Health insurance can either reimburse the insured for expenses incurred from illness or injury or pay the care provider directly.

home values

Also called property values. An estimate of what a home or a piece of land is actually worth.

homeless shelters

A building set up to provide for the needs of homeless people; often including shelter, food, sanitation and other forms of support.

hotel/motel vouchers

Programs that provide homeless people with a temporary place to stay (usually one to three nights), generally utilizing a hotel or motel with which the referring agency has a prior agreement, but in some cases, that is selected by the individual.

household expenses

General living expenses, including the amount paid for lodging, food consumed within the home, utilities and other expenses.

household size

A household is the number of people that live together. For the purpose of taxes or public benefits, your household includes all of the people for whom you are financially responsible, including your spouse and dependents.

Housing Choice Voucher Program

One component of the Section 8 housing program, which provides “tenant-based” rental assistance, so a tenant can move from one unit of at least minimum housing quality to another. It also allows individuals to apply their monthly voucher towards the purchase of a home. The maximum allowed voucher is $2,000 a month.

housing counseling centers

Non-profit organizations that provide advice and couseling on preventing foreclosure, buying a home, protecting your credit, and other issues. Housing counseling centers (or agencies) msut be certified by HUD to ensure that they are competent to provide such services.

identity theft

The illegal use of someone else’s personal information in order to obtain money or credit.

imposter site

A site that looks like annualcreditreport.com and promises a free credit report credit, but may acutally charge a fee. AnnualCreditReport.com is the only official site explicitly directed by Federal law to provide consumers with a free credit report.

income

Monetary payment received for goods or services, or from other sources such as rents or investments.

income verification

The submission of documents such as paystubs, W-2 forms, or tax records that verify individual or household income. Often required when applying for a loan.

information provider or furnisher

A company that provides information to consumer reporting agencies. Furnishers are typically organizations that provide financial services, such as banks and credit card companies, but may also include debt collection agencies and other companies that process financial information.

installment loans

An installment loan is a loan that is repaid over time with a set number of scheduled payments. The term of loan may be as little as a few months and as long as 30 years. A mortgage, for example, is a type of installment loan.

Insurance company

A business that provides coverage, in the form of compensation resulting from loss, damages, injury, treatment or hardship in exchange for premium payments. The company calculates the risk of occurrence then determines the cost to replace (pay for) the loss to determine the premium amount.

insurance coverage

Insurance coverage is the amount of risk or liability covered for an individual or organization. Payment is issued by an insurer in the event of unforeseen or unwanted occurrences.

Insurance premium

The amount paid periodically to an insurer by the insured for covering his risk.

interest

Money paid regularly at a particular rate for the use of money lent, or for delaying the repayment of a debt.

Interest rate

An interest rate is the amount charged, expressed as a percentage of the loan amount, by a lender to a borrower. Interest rates are typically noted on an annual basis, known as the annual percentage rate (APR).

investments

An asset or item that is purchased with the hope that it will generate income or appreciate in the future.

IRS Form W-4

A W-4 form is a form completed by an employee to indicate his or her tax situation (exemptions, status, etc.) to the employer. The W-4 form tells the employer the correct amount of tax to withhold from an employee’s paycheck. You must complete a new Form W-4 when your personal or financial situation changes.

judgement

A court ruling that gives a creditor the right to take possession of a debtor’s property if the debtor fails to fulfill his or her contractual obligations. A judgment lien may be made against an individual or business and allows the creditor to access the debtor’s business, personal property and real estate, among other assets, to pay the judgment.

Landlord

A person or organization that owns and leases property to others, including houses and apartments.

Late fee

Renters that do not pay their rent on the date specified in their lease or rental agreement may be charged a fee, though it should not apply until at least three days after the rent is due. Late fees should not exceed 5% of the rent.

lawsuit

A case in a court of law involving a claim, complaint, etc., by one party against another.

lease

A contract by which one party conveys land, property, services, etc., to another for a specified time, usually in return for a periodic payment.

legal aid

Legal aid is the provision of assistance to people otherwise unable to afford legal representation and access to the court system. Many communities have nonprofit, community legal clinics that provide a broad range of legal services (e.g. representation, education, law reform).

letter of guarantee

A letter of guarantee is a contract issued by a trusted institution, such as a bank, that promises to meet any financial obligations that result from a customer’s default on a debt.

life insurance

A type of insurance that protects against the loss of income that would result if the insured passed away. The named beneficiary receives the proceeds and is thereby safeguarded from the financial impact of the death of the insured.

line of credit

An arranged amount of standing credit that a bank’s customer may draw upon at any time.

Loan

A sum of money that is borrowed and expected to be paid back, often with interest.

loan modification

A permanent restructuring of the mortgage where one or more of the terms of a borrower’s loan are changed to provide a more affordable payment. Loan modifications typically involve a reduction in the interest rate on the loan, an extension of the length of the term of the loan, a different type of loan or any combination of the three. A lender might be open to modifying a loan because the cost of doing so is less than the cost of default.

loan servicer

An institution, such as a bank, that collects interest, principal and escrow payments from a borrower.

low limit credit card

A card offered by a lender that specializes in working with people with credit challenges. Cards with low-limits help to establish credit in order to get higher limits in the future.

market conditions

Features of the (financial) marketplace including current interest rates, employment levels, demographics, and vacancy rates.

Modest Needs

Modest Needs provides short-term financial assistance to individuals and families in temporary crisis who, because they are working and live just above the poverty level, are ineligible for public benefits but who are at risk of homelessness.

money order

A money order is a certificate that allows the stated payee to receive cash on-demand. A money order functions much like a check, in that the person who purchased the money order may stop payment if it is lost or stolen.

monthly expenses

All of the expenses that are necessary to maintain health and well-being and to earn money. Such expenses include housing, food, clothing, and transportation, utilities and insurance. Monthly expenses also include any regularly scheduled debt payments.

mortgage

A mortgage is a loan for the purchase of property. The borrower enters into an agreement with the lender (usually a bank) wherein the borrower receives cash upfront then makes payments over a set time span until he pays back the lender in full.

Mortgage lender

A mortgage lender is a company that lends money to borrowers for the purchase of homes.

non-profit housing counselor

An experienced, trained professional that can advise you on preventing foreclosure, buying a home, protecting your credit, and other issues. Housing counseling agencies and counselors are required to be certified by HUD to ensure that they are competent to provide such services.

nonprofit cooperative

A cooperative is a legal entity owned and democratically controlled by its members

not-for-profit organizations

A type of organization that does not earn profits for its owners. All of the money earned by or donated to a not for profit organization is used in pursuing the organization’s objectives. Typically not for profit organizations are charities or other types of public service organizations.

notary

A public officer or other person authorized to authenticate contracts, acknowledge deeds, take affidavits, protest bills of exchange, take depositions, etc.

obligations

Something to which a person is legally bound, such as a loan or lease.

order to set aside judgment

A “default judgment” is a money judgment awarded against an individual that fails to appear in court. A default judgement can be collected like any other judgment, including wage or account garnishment. Individuals that do not think the default judgment was appropriately entered against them must file a motion with the court asking the judge to “set aside” the judgment. If the judge grants the motion, the case starts back up again and the individual must then appear in court to defend him/herself.

pawn shop

A store that offers loans in exchange for personal property as collateral. Pawnshops provide loans that are equal to a fraction of the value of the collateral. If the individual returns within the time specified and pays back the loan, she will get her property back. If she returns within the time specified, but does not have enough money to repay the loan, she can renew it for a fee. If she does not return to repay or renew the loan, the pawnshop will then sell the item to cover the loan.

pawn shop loan

A loan in exchange for personal property as collateral. Pawnshops provide loans that are equal to a fraction of the value of the collateral. If the individual returns within the time specified and pays back the loan, she will get her property back. If she returns within the time specified, but does not have enough money to repay the loan, she can renew it for a fee. If she does not return to repay or renew the loan, the pawnshop will then sell the item to cover the loan.

Pay Rent or Quit Notice

A written notice given to a tenant by a landlord when the tenant is late with the rent. The notice tells the tenant to pay the rent, sometimes within a specified number of days, or leave the premises. If the tenant does neither, the landlord may file an eviction lawsuit.

paycheck stub

A paycheck stub, also called a paystub or check stub, is a document that attached to a paycheck. It shows the amount of money that an employee earned during the pay period and the amount that was removed for taxes, insurance costs, retirement plan or pension contributions, garnishments, and/or charitable contributions. It may also show the year-to-date totals of each deduction.

payday lender/payday loan

A payday loan is a short-term, high-interest loan that is repaid when the borrower receives their next paycheck. Though these lenders typically do not require a credit check, the borrower must have a bank account and often has to provide proof of employment. The borrower provides collateral in the form of a post-dated personal check in the amount they wish to borrow, plus a fee.

payroll card

An alternative to direct deposit or paper checks. These cards are issued by major payment processors and allow workers to use them anywhere credit cards are accepted. Users can access their money from an ATM or receive cash back from a purchase, in a similar manner as with a traditional debit or credit card.

Personal Identification Number (PIN)

A personal identification number, or PIN, is a numeric password used to authenticate a user to a system, in particular in association with a debit card. The PIN is not printed or embedded on the card but is manually entered by the cardholder during ATM and point of sale transactions.

personal loan

A loan that is issued and supported only by the borrower’s creditworthiness, rather than by a type of collateral. They are backed only by your promise to repay. Also known as “signature loans” or “unsecured loans.”

PLUS loans

A federal student loan offered to parents of students, or graduate and professional students, at participating and eligible post-secondary institutions.

post-tax deduction

An amount subtracted from a paycheck after all applicable state and federal income taxes have been deducted. Examples of post-tax deductions are union dues, charitable contributions or non-qualified savings contributions.

poverty level

The federal poverty level is the minimum amount of gross income that a family needs for food, clothing, transportation, shelter and other necessities. The amount is determined by the Department of Health and Human Services and varies according to family size.

power of attorney

Power of Attorney is the authority to act for another person in specified or all legal or financial matters.

pre-approved credit card offer

A pre-approved credit card offer is made by a bank or other lender based on a review of your consumer file by one the consumer reporting agencies. Banks provide the agencies with detailed lending criteria, and the agencies return a list of consumer meeting the specifications. Pre-approvals are logged as soft inquires on your credit report. Banks must make a firm offer of credit to anyone that receives a pre-approval offer, provided the recipient continues to meet the original underwriting criteria.

pre-tax deductions

Amounts subtracted from your paycheck that lower your taxable wages. Employers will subtract these contributions from employees’ wages before figuring their tax withholding. Some pretax deductions reduce taxable wages for income tax; others reduce taxable wages for Social Security and Medicare taxes.

pre-tax wages

All of the money you’ve made while working at your job before any deductions are taken for state and federal taxes, Social Security and health insurance.

prepaid college tuition plan

Prepaid tuition plans are often sponsored by states and allow account holders to purchase tuition at roughly today’s rates and redeem the credits in the future, with the state absorbing any tuition increases during the years in between.

prescreened credit offers

Prescreened offers, or preapproved offers, are based on information in your credit report that indicates you meet criteria set by the offeror. Usually, prescreened solicitations come via mail, but you also may get them in a phone call or in an email.

principal

A sum of money lent or invested on which interest is paid.

private student loans

Private student loans are nonfederal loans, made by a lender such as a bank, credit union, state agency, or a school.

privately owned subsidized housing

Housing owned and managed by individual landlords, for-profit companies, or non-profit organizations that receive subsidies in exchange for renting to low- and moderate-income people.

probate court

Probate is a legal process that takes place after someones death. It usually involves proving that the deceased’s will is valid, identifying the deceased person’s property and having it appraised, paying outstanding debts and taxes, and distributing the property per the will or state law. Probate courts ensure proper distribution of the assets of the deceased, assesses the validity of wills, enforces the provisions of a valid will, prevents misconduct by executors and administrators of estates, and provides for the equitable distribution of the assets of persons who die without a valid will.

promotional financing

Promotional financing is a low interest rate offered on your credit card balance for a certain period of time. It is often an introductory interest rate that applies to the first few months after you open the credit card account.

property lien

A notice attached to your property by a creditor that claims you owe it some money. Liens make it difficult for owners to sell or refinance their property because the title to the property is unclear. A lien is typically a public record and is filed with a county records office or with a state agency. Property liens are a common way for creditors to collect what they are owed.

public benefits

Public benefits are cash or cash equivalents provided by federal or state funds that supplement or replace income. They include welfare, health, disability, housing, post-secondary education, food assistance, and unemployment. The payments or assistance can be provided to an individual, household or family unit.

public health benefits

There are two government-funded programs to help people pay for medical expenses. Medicare is health care program for people who are 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD). Medicaid is a health care program that assists low-income families or individuals in paying for long-term medical and custodial care costs.

Public housing

Public housing was create to provide decent and safe rental housing for eligible low-income families, the elderly, and persons with disabilities. It is funded by the U.S. Department of Housing and Urban Development and managed by a local housing authority. Public housing comes in all sizes and types, from scattered single family houses to highrise apartment buildings.

public housing authority

Also referred to as the local housing authority, it is the state or municipal agency that manages public housing.

public record

Any information, files, accounts or other records that a governmental body is required to maintain, and that must be accessible to the public. This includes the files of most legal actions.

Publicly subsidized housing

Government funded program aimed at lessening housing costs and expenses for people with low to moderate incomes.

real estate taxes

Also called property taxes; the annual amount paid by a land owner to the local government or the municipal corporation of his area.

refinance

Revising a payment schedule for repaying debt, typically with a new loan at a lower rate of interest.

Refund Anticipation Check

A Refund Anticipation Check is a tax refund payment made to a temporary bank account. When the money arrives, the bank issues a check or prepaid debit card, minus the tax preparation charge, and closes the account.

Refund Anticipation Loan

A short-term loan that is based on and usually repaid by an anticipated federal income tax refund. Refund Anticipation Loans are offered starting in January through the end of the tax season in April. Taxpayers are generally charged fees and interest to obtain this type of loan.

renewal clause

When a contract is renewed unless one party decided to discontinue it.

rent

Regular payment to a landlord for the use of property, including an apartment or house.

rental agreement

A written agreement that establishes or modifies the terms and conditions regarding the use and occupancy of a residence and its premises.

renter's insurance

A form of property insurance that provides coverage for a policy holder’s belongings and liability within a rental property. Renter’s insurance applies to persons renting or subletting a single family home, apartment, duplex, condo, studio, loft or townhome.

repayment plan

​A repayment plan is a plan for paying any outstanding debts. Within a payment plan, the borrower agrees to pay back a certain amount of money each month to repay the debt.

repossession

When a financial institution takes back an object that was either used as collateral, rented, or leased, due to non-payment.

resources

Cash, goods, or services.

retirement plan

An umbrella term for the different types of accounts that exist to help individuals save for retirement.

Return on investment

The future monetary benefit that someone receives as a result of a purchase or improvement. A high return on investment means the profit compares favorably to the cost.

revolving credit

A type of credit that does not have a fixed number of payments. The lending institution sets a maximum credit limit. When payments are made on the account, those funds become available for borrowing again.

Risk-based pricing

Offering different interest rates and loan terms to different consumers based on the estimated level of risk that they will not pay back money lent to them. Depending on the type of loan, risk-based pricing looks at factors such as a consumer’s credit score, credit history, employment status and income. It does not consider factors such as race, color, national origin, religion, gender, marital status or age. Types of companies that use risk-based pricing include credit card issuers, mortgage lenders, utility companies, telecommunications companies and any other company that considers a consumer’s credit score before agreeing to do business with them.

risk-based pricing notice

A risk-based pricing notice informs consumers that they may have received less favorable credit terms than others with better credit histories. This notice will be sent only to approved applicants or customers who likely did not receive the lender’s most favorable terms. Lenders that use credit scores in making lending decisions must include the credit score in the letter as well as the reasons why the score was not better.

Roth IRA

Roth IRAs are individual retirement accounts funded with after-tax dollars. The contributions are not tax deductible, but when you start withdrawing funds, these qualified distributions are tax free.

safe deposit box

A box located inside a bank that is used to store valuables. A safe deposit box is rented from the institution and can be accessed with keys, pin numbers or some other security pass.

Salvation Army

An international charitable organization devoted chiefly to evangelism and to providing social services, especially to the poor. It is present in 127 countries, running charity shops, operating shelters for the homeless, and providing personal hygiene products, disaster relief and humanitarian aid to developing countries.

Savings

Savings is the portion of disposable income not spent on housing, food, utilities, debt repayment, or other goods and services.

savings account

A deposit account held at a bank or other financial institution that safeguards funds and provides a modest interest rate.

scam

A fraudulent or deceptive act or operation

School default rate

The school default rate measures the percentage of students who fail to repay their federal student loans. A lower default rate indicates that students are finding an adequate means of income after leaving the school because they can afford to pay back their student loans. Lower default rates also indicate a lower amount of student debt.

seasonal income

Income that is regularly received for only part of the year.

Second Chance accounts

Checking accounts for people that have been restricted from opening a checking account due to a ChexSystems record or previous account mismanagement. These accounts may come with different fees or restrictions than traditional checking accounts. You may also be required to complete financial education before you may open a fresh start account.

Section 8

A program, funded by the U.S. Department of Housing and Urban Development, that authorizes the payment of rental housing assistance to private landlords on behalf of low-income households. Qualified recipients receive a voucher that reduces the cost of rent. A voucher may be either “project-based”—where its use is limited to a specific apartment complex—or “tenant-based”, where the tenant is free to choose a unit in the private sector and is not limited to specific complexes.

secured credit card

A type of credit card that is backed by a savings account. Money is deposited and held in the account backing the card to ensure that the creditor will be recouped any charges that are not repaid. The limit will be based on both your previous credit history and the amount deposited in the account.

secured loan

A secured loan is a loan in which the borrower pledges some asset (e.g. a car or property) to guarantee payment of the loan.

security breach

Any incident that results in unauthorized access of data, applications, services, networks and/or devices by bypassing their underlying security mechanisms.

security deposit

A security deposit is money aside from the payment of rent that a landlord requires a tenant to pay to be kept separately in a fund for use should the tenant cause damage to the premises or otherwise violate terms of the lease.

security freeze

Security freezes are designed to prevent a credit reporting company from releasing your credit report without your consent. When you place a security freeze on your file, you will be provided a personal identification number or password to use if you choose to remove the security freeze from your file or authorize the temporary release of your credit report for a specific person or period after the security freeze is in place.

settle

To resolve or reach an agreement about a debt or other financial matter.

share account

An account at a credit union.

share draft account

An account that allows credit union members to access their share balances by writing drafts on their accounts.

share holders

Any person or company that owns at least one share of a company’s stock, making them the company’s owners. They have the potential to profit if the company does well, but that comes with the potential to lose if the company does poorly. A shareholder may also be referred to as a “stockholder.”

Sheriff's Escort

Once a landlord wins an eviction lawsuit, they must give the court judgment to a local law enforcement office. A sheriff or marshal will give the tenant notice that the officer will be back within a few days to escort the tenant off the property.

short-sell

The sale of real estate in which the net proceeds from selling the property fall short of the amount owed on the property. If all lenders agree to accept less than the amount owed, a sale of the property can be accomplished. The creditors do not have to agree to accept less, but they often do since the alternative is to let the property go to foreclosure.

short-term rental

A short-term lease generally refers to a lease with a duration of less than six months. Often, they are based on a month-to-month rental agreement, which may or may not be renewed at the end of each month.

signature loan

A signature loan is a type of personal loan offered by banks and other finance companies that uses only the borrower’s signature and promise to pay as collateral. Also known as a “personal loan” or “unsecured loan.”

small dollar loan

A loan ranging from $500-$5,000 that are typically used to purchase goods or services.

Social Security

A United States federal program of social insurance and benefits. it provides retirement income, disability income, Medicare and Medicaid, and death and survivorship benefits.

social security card

Wallet-sized piece of paper containing unique nine-digit number assigned by the Social Security Administration and provided to every United States citizen, permanent resident, or temporary working resident.

Social Security number

A Social Security number is a number in the format 000-00-0000, unique for each individual, used to track Social Security benefits and for other identification purposes.

specialty consumer reports

Specialty consumer reporting agencies collect and share information about your transaction history with a business or using a specific product or service. The information a specialty consumer reporting agency collect depends on the agency and its specialty industry.

state assistance

State Funded Housing Assistance Programs provide affordable housing for low-income individuals with mental illness orother disabilities, or who may be homeless or at-risk of homelessness. Often, these programs are intended to be temporary, or a ‘bridge’ to more permanent, federally subsidized rental assistance.

state income tax

A tax imposed on income that is paid to the state in which you live and/or work. State income taxes have their own set of deductions and credits.

statute of limitations

A statute of limitations sets a timeframe within which creditors or other affected parties must take action to enforce their rights or to seek redress after a damage or injury. This period varies according to the nature of the case.

student loans

A loan offered to students that is used to pay education-related expenses, such as college tuition, room and board at the university, or textbooks. Both the federal government and private companies offer student loans. However, student loans offered by the federal government generally have lower interest rates.

subletting

Leasing of part or all of the property by a tenant, as opposed to a landlord, during a portion of his or her term of occupancy. A landlord may prohibit a tenant from subletting the leased premises without the landlord’s permission by including such a term in the lease. When subletting is permitted, the original tenant becomes, in effect, the landlord of the sublessee.

subsidy

A sum of money granted by the government or a public body to assist an industry or business so that the price of a product or service may remain low.

tax credits

An amount of money that a taxpayer is able to subtract from the amount of tax that they owe to the government.

tax deductions

A tax deduction is a reduction of income that is able to be taxed, and is commonly a result of expenses. The difference between deductions, exemptions and credit is that deductions and exemptions both reduce taxable income, while credits reduce tax.

tax filing status

Federal tax filing status defines the type of tax return form an individual will use. A taxpayer will fall into one of five possible filing status categories: single individual, married person filing jointly, married person filing separately, head of household, and widow(er) with dependent children. A taxpayer who qualifies for more than one filing status may choose the most advantageous status.

tax lein

A tax lien allows the government to take possession of and sell property to secure the payment of taxes. A tax lien may be imposed for delinquent taxes owed on real property or personal property, or as a result of failure to pay income taxes or other taxes.

TeleCheck

A check processing and authorization service provided to merchants and financial institutions.

tenant

A person who occupies land or property rented from a landlord.

tenant screening

Tenant screening is a process used primarily by residential landlords and property managers to evaluate prospective tenants.The purpose is to assess the likelihood the tenant will fulfill the terms of the rental agreement. The process culminates in a decision as to whether to approve the applicant, approve the applicant conditionally (such as requiring an increased deposit or cosigner) or deny tenancy.

tenant screening reports

Tenant screening companies provide reports to landlords on prospective tenants, which may include the following: consumer credit report (with or without a score) from one of the three national credit bureaus (Experian, Equifax or Transunion); eviction records search results; criminal records search results ; sex offender registry search results; specially designated nationals search results (frequently referred to as an OFAC search); rental references; employment verifications; and a recommendation based on the landlord’s criteria.

term of your loan

Period during which a loan agreement is in force, and before or at the end of which the loan should either be repaid or renegotiated for another term.

Termination for cause

Although terminology varies somewhat from state to state, there are basically three types of termination notices that you might receive if you have violated the rental agreement or lease in some way: Pay Rent or Quit; Cure or Quit; or Unconditional Quit.

Termination without cause

Termination Without Cause allow either the tenant or the landlord to end a tenancy for no reason (“no cause”) when the tenancy is month-to-month and no rental subsidy is directly associated with the rental unit. Many require written notice to be given to either the tenant or the landlord, but the process varies by state.

terms of the loan

Period over which a loan agreement is in force, and before or at the end of which the loan should either be repaid or renegotiated for another term.

thin credit file

A thin credit file refers to those who have little to no credit. They may have few to no sources of credit, or their credit history is short.

third party debt collector

Third-party debt collectors, also called debt collection agencies, are businesses that pursue payments of debts owed by individuals or businesses. Third-party collectors are separate companies that are contracted to collect debts for a fee. Some third-party debt collectors purchase debt at a percentage of its value, then attempt to collect it.

title

A legal right to the ownership of property.

trade line renting

Trade line renting pairs credit-challenged consumers with creditworthy consumers willing to add a stranger as an authorized user in exchange for money. The purpose of trade line renting is to improve the credit score of the “renter” by adding positive information to their payment history. While this practice is not illegal, some consider it to be bank fraud since “renters” are technically deceiving banks about their assets.

transaction

An instance of buying or selling something.

transfer

The act of moving money from one place to another; generally from one account to another.

transitional housing programs

Programs that provide temporary residence—up to 24 months—for people experiencing homelessness. Housing is combined with wrap-around services to help the individual increase the stability in their lives.

transitional living

A housing situation that is short-term. Transitional living residences serve those recovering from economic hardship and provide supports and services to help residents move to independent housing.

TransUnion

TransUnion is a consumer credit reporting agency in the United States, considered one of the three largest American credit agencies, along with Experian and Equifax.

trust fund

A trust fund is a fund comprised of a variety of assets intended to provide benefits to an individual or organization. A individual establishes a trust fund to provide financial security to an individual, most often a child or grandchild, or organizations, such as a charity or other nonprofit organization.

U.S. Department of Housing and Urban Development (HUD)

The principal federal agency responsible for programs concerned with housing needs, fair housing opportunities, and improving and developing U.S. communities.

U.S. Savings Bond

US Savings Bonds are investments that offer a fixed rate of interest over a fixed period of time. They are one of the safest investments because they are endorsed by the federal government.

Unconditional Quit Notice

Unconditional Quite Notices order you to vacate the premises with no chance to pay the rent or correct a lease or rental agreement violation. In most states, unconditional quit notices are allowed only if you have: repeatedly violated a significant lease or rental agreement clause; ◦been late with the rent on more than one occasion; seriously damaged the premises, or engaged in serious illegal activity, such as drug dealing on the premises.

unemployment compensation

Financial compensation to unemployed workers, provided in the United States chiefly by state governments. Funds are provided to workers who have lost their jobs due to layoffs or retrenchment. It is meant to provide a source of income for workers until they can find new employment.

Unemployment Insurance

Financial compensation to unemployed workers, provided in the United States chiefly by state governments. Funds are provided to workers that have lost their jobs due to layoffs or retrenchment. It is meant to provide a source of income for workers until they can find new employment.

Uniform Gift to Minors Act

The Uniform Gift to Minors Act allows assets to be held in a custodian’s name for the benefit of a child under 18 without an attorney needing to set up a special trust fund. This allows a child to have property set aside for their benefit and may achieve some income tax benefit for the child’s parents. Once the child becomes an adult (18 or 21 depending on the state), the assets become the property of the child and the child can use them for any purpose.

Uniform Transfers to Minors Act

The Uniform Transfers to Minors Act (UTMA) allows a minor to receive gifts, such as money, patents, royalties, real estate and fine art, without the aid of a guardian or trustee. Under the UTMA, the gift giver or an appointed custodian manages the minor’s account until the latter is of age.

USDA Rural Development Program

The USDA Multi-Family Housing Rental Assistance program provides payments to owners of USDA-financed Rural Rental Housing or Farm Labor Housing projects on behalf of low-income tenants unable to pay their full rent. The program also works with lenders to help low- and moderate-income households purchase adequate, modest, decent, safe and sanitary dwellings as their primary residence in eligible rural areas. The program provides a 90% loan note guarantee to approved lenders in order to reduce the risk of extending 100% loans to eligible rural homebuyers.

utilities

A service, such as electricity or water, that is provided to the public.

Utility company

An organization that is regulated by the government and provides an essential commodity or service to the public, such as water, electricity, transportation, or communication.

vacated judgment

A vacated judgment makes a previous legal judgment legally void. A vacated judgment is usually the result of the judgment of an appellate court, which overturns, reverses, or sets aside the judgment of a lower court.

VantageScore

VantageScore is the name of a credit rating product that was created by the three major credit bureaus (Equifax, Experian, and TransUnion). The VantageScore is an attempt to compete with the FICO score produced by FICO.

verbal agreement

Also called an oral contract. A type of business agreement that is spoken, not memorialized in writing. Although it can be difficult to prove the terms of an verbal agreement in the event of a breach, this type of contract is legally binding.

viewing

A viewing (also called a wake) allows friends and family to spend time with the deceased prior to burial. The body is usually on display in a casket. Viewings take place at funeral homes, churches, social halls, or other locations. Viewings may be brief and take place immediately before the funeral service, or may last for up to three days before the service.

wage garnishment

Wage garnishment is the process of deducting money from an employee’s monetary compensation (including salary), sometimes as a result of a court order. Wage garnishments continue until the entire debt is paid or arrangements are made to pay off the debt.

warranty

A written guarantee, issued to the purchaser of an article by its manufacturer, promising to repair or replace it if necessary within a specified period of time.

Will

A legal document by which a person expresses his or her wishes as to how his or her property is to be distributed at death, and names one or more persons, the executor, to manage the estate until its final distribution.

wire transfer

A method of electronic funds transfer from one person or entity to another. A wire transfer can be made from one bank account to another bank account or through a transfer of cash at a cash office.

withdrawal

The act of taking money out of an account.

withholding

The portion of an employee’s wages that is not included in his or her paycheck because it is sent directly to the federal, state and local tax authorities. Withholding reduces the amount of tax employees must pay when they submit their annual tax returns.

Worker's compensation

A form of insurance that provides wage replacement and medical benefits to employees injured in the course of employment. Workers that receive in exchange for mandatory relinquishment of the employee’s right to sue his or her employer for the tort of negligence.

yard sale

A sale of used or unwanted household goods or personal items, typically held in one’s garage or yard.