A loan is defined at the temporary provision of money (usually with interest payable)
Interest is defined as the cost of borrowing money. Usually it is given as
a percentage per year - eg: annual percentage rate - APR
Compound interest - interest added to the principal amount (the loan) and itself begins to earn interest
Simple interest - The type of interest that is earned on the original principal only
Principal - the original amount of a debt on which interest is calculated
Secured loan - A loan that is backed by collateral - usually secured on a property.
Unsecured loan is one that is not secured by collateral.
Adverse credit is when the debtor has a poor credit history and is more likely to default on payments. There is more risk.
Credit history - how you have handled debt in the past. Scores are recorded each time you make an application for credit and repayment schedules are noted, so if you miss or are late poaying it shows up. This information is gathered to produce a report available to see how you are likely to handle debt in the future. It considers information like how many cards you have, how much it looks like you spend a month (Do you live beyond your means) and how often you've moved, and how much credit you use of that available to you.
| Back to main page of GetLoan.co.uk |