Table of Contents Expand Declining Financial Literacy What Is Financial Literacy? Trends Making It More Important Why It Matters The Bottom Line Declining Financial Literacy In past generations, cash was used for most daily purchases; today, it's rarely flashed—particularly not by younger shoppers. The way we shop has changed as [...]
What Is a Credit Application? A credit application is a request for an extension of credit. Credit applications can be done either orally or in written form usually through an electronic system. Whether done in person or individually the application must legally contain all pertinent information relating to the cost [...]
What Is Margin Debt? Margin debt is debt a brokerage customer takes on by trading on margin. When purchasing securities through a broker, investors have the option of using a cash account and covering the entire cost of the investment themselves, or using a margin account—meaning they borrow part of [...]
Table of Contents Expand 1. Does Not Teach Self-Control 2. Means You Don’t Have a Budget 3. Interest Is Expensive 4. Rates Rise with Unpaid Balances 5. Poor Credit Score Affects a Lot 6. Bad Habits Risk Relationships 7. Financing Leads to More Spending 8. Can Lead to Bankruptcy 9. [...]
What Is the Back-End Ratio? The back-end ratio, also known as the debt-to-income ratio, is a ratio that indicates what portion of a person's monthly income goes toward paying debts. Total monthly debt includes expenses, such as mortgage payments (principal, interest, taxes, and insurance), credit card payments, child support, and [...]
What Is an Interest Rate Cap Structure? An interest rate cap structure refers to the provisions governing interest rate increases on variable-rate credit products. An interest rate cap is a limit on how high an interest rate can rise on variable-rate debt. Interest rate caps can be instituted across all [...]
When it comes time to borrow money, options abound. People can go to a bank for a traditional fixed- or variable-rate loan, turn to pawnshops or payday lenders (though neither is a good idea apart from the direst of circumstances), use credit cards, borrow from friends or family, or even [...]
Experian vs. Equifax: An Overview Experian and Equifax are the two largest credit bureaus in the U.S. Both companies collect and research credit information of individuals and rate the overall ability to pay back a debt. Credit bureaus like Experian and Equifax provide the information they gather to creditors for [...]
The letters or numbers used to express a credit rating or credit score express the creditworthiness of the individual, business, or government being assessed. Credit ratings are usually expressed in letters such as "AAA" or "BB." Credit scores, which are normally assigned to individuals, are expressed as numbers ranging from [...]
What Is the Fair Credit Billing Act? The Fair Credit Billing Act is a 1974 federal law designed to protect consumers from unfair credit billing practices. Understanding the Fair Credit Billing Act The Fair Credit Billing Act (FCBA) lays out consumers' rights to dispute credit card issuers' charges: Consumers have [...]