Account agreement
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Account Agreement
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The contract
governing your open-end credit account, it provides information on changes
that may occur to the account.
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Account History
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The payment
history of an account over a specific period of time, including the number of
times the account was past due or over limit.
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Account Holder
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Any and all
persons designated and authorized to transact business on behalf of an
account. Each account holder's signature needs to be on file with the bank.
The signature authorizes that person to conduct business on behalf of the
account.
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Accrued Interest
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Interest that has
been earned but not yet paid.
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Acquiring Bank
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In a merger, the
bank that absorbs the bank acquired.
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Adjustable-Rate Mortgages (ARMS)
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Also known as
variable-rate mortgages. The initial interest rate is usually below that of
conventional fixed-rate loans. The interest rate may change over the life of
the loan as market conditions change.
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There is
typically a maximum (or ceiling) and a minimum (or floor) defined in the loan
agreement. If interest rates rise, so does the loan payment. If interest
rates fall, the loan payment may as well.
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Adverse Action
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Under the Equal
Credit Opportunity Act, a creditor's refusal to grant credit on the terms
requested, termination of an existing account, or an unfavorable change in an
existing account.
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Adverse Action Notice
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The notice
required by the Equal Credit Opportunity Act advising a credit applicant or
existing debtor of the denial of their request for credit or advising of a
change in terms considered unfavorable to the account holder.
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Affidavit
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A sworn statement
in writing before a proper official, such as a notary public.
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Alteration
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Any change
involving an erasure or rewriting in the date, amount, or payee of a check or
other negotiable instrument.
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Amortization
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The process of
reducing debt through regular installment payments of principal and interest
that will result in the payoff of a loan at its maturity.
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Annual Percentage Rate (APR)
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The cost of
credit on a yearly basis, expressed as a percentage.
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Annual Percentage Yield (APY)
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A percentage rate
reflecting the total amount of interest paid on a deposit account based on
the interest rate and the frequency of compounding for a 365-day year.
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Annuity
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A life insurance
contract sold by insurance companies, brokers, and other financial
institutions. It is usually sold as a retirement investment. An annuity is a
long-term investment and can have steep surrender charges and penalties for
withdrawal before the annuity's maturity date. (Annuities are not FDIC insured.)
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Application
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Under the Equal
Credit Opportunity Act (ECOA), an oral or written request for an extension of
credit that is made in accordance with the procedures established by a
creditor for the type of credit requested.
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Appraisal
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The act of evaluating
and setting the value of a specific piece of personal or real property.
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Authorization
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The issuance of
approval, by a credit card issuer, merchant, or other affiliate, to complete
a credit card transaction.
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Automated Clearing House (ACH)
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A computerized
facility used by member depository institutions to electronically combine,
sort, and distribute inter-bank credits and debits. ACHs process electronic
transfers of government securities and provided customer services, such as
direct deposit of customers' salaries and government benefit payments (i.e.,
social security, welfare, and veterans' entitlements), and preauthorized
transfers.
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Automated Teller Machine (ATM)
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A machine,
activated by a magnetically encoded card or other medium, that can process a
variety of banking transactions. These include accepting deposits and loan
payments, providing withdrawals, and transferring funds between accounts.
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Automatically Protected
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As of May 1,
2011, up to two months of Federal benefits such as Social Security benefits,
Supplemental Security Income benefits, Veteran’s benefits, Railroad
Retirement benefits, and benefits from the Office of Personnel Management
that are direct deposited to an account may be protected from garnishment.
The amount automatically protected will depend upon the balance of the
account on the day of review.
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Automatic Bill Payment
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A checkless
system for paying recurring bills with one authorization statement to a
financial institution. For example, the customer would only have to provide
one authorization form/letter/document to pay the cable bill each month. The
necessary debits and credits are made through an Automated Clearing House
(ACH).
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Availability Date
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Bank's policy as
to when funds deposited into an account will be available for withdrawal.
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Availability Policy
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Bank's policy as
to when funds deposited into an account will be available for withdrawal.
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Available Balance
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The balance of an
account less any hold, uncollected funds, and restrictions against the
account.
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Available Credit
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The difference
between the credit limit assigned to a cardholder account and the present
balance of the account.
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