Account Agreement:
The contract governing your open-end credit account, it provides information on changes that may occur to the account.
Account History:
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.
Account Holder:
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.
Accrued Interest:
Interest that has been earned but not yet paid.
Acquiring Bank:
In a merger, the bank that absorbs the bank acquired.
Adjustable-Rate Mortgages (ARMS):
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.
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.
Adverse Action:
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.
Adverse Action Notice:
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.
Affidavit:
A sworn statement in writing before a proper official, such as a notary public.
Alteration:
Any change involving an erasure or rewriting in the date, amount, or payee of a check or other negotiable instrument.
Amortization:
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.
Annual Percentage Rate (APR):
The cost of credit on a yearly basis, expressed as a percentage.
Annual Percentage Yield (APY):
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.
Annuity:
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.)
Application:
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.
Appraisal:
The act of evaluating and setting the value of a specific piece of personal or real property.
Authorization:
The issuance of approval, by a credit card issuer, merchant, or other affiliate, to complete a credit card transaction.
Automated Clearing House (ACH):
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.
Automated Teller Machine (ATM):
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.
Automatically Protected:
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.
Automatic Bill Payment:
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).
Availability Date:
Bank's policy as to when funds deposited into an account will be available for withdrawal.
Availability Policy:
Bank's policy as to when funds deposited into an account will be available for withdrawal.
Available Balance:
The balance of an account less any hold, uncollected funds, and restrictions against the account.
Available Credit:
The difference between the credit limit assigned to a cardholder account and the present balance of the account.
