Business news and more
A credit limit is the maximum amount of credit extended to a borrower by a lender, typically on a credit card or loan. It represents the highest amount of debt the borrower can incur on the account. Types of Credit Limits 1. Credit Card Limit: The maximum amount that can be charged on a credit…
An interest rate is a percentage charged on borrowed money, representing the cost of borrowing for the borrower and the income for the lender. Interest rates vary depending on the type of loan, borrower’s creditworthiness, and market conditions. Types of Interest Rates 1. Fixed Interest Rate: Remains constant throughout the loan term. 2. Variable Interest…
An annual fee is a yearly charge levied by financial institutions on credit cards, loans, and other financial services. It is essential to understand the purpose and implications of annual fees to make informed financial decisions. Types of Annual Fees 1. Credit Card Annual Fee: Charged on credit card accounts. 2. Loan Origination Fee: One-time…
A credit score is a three-digit number that represents an individual’s or business’s creditworthiness. It plays a crucial role in determining loan approvals, interest rates, and credit limits. Maintaining a good credit score is essential for financial health. Types of Credit Scores 1. FICO Score: Most widely used credit scoring model. 2. Vantage Score: Alternative…
A payment due date is the specific date by which a payment must be made to avoid late fees, penalties, and negative credit reporting. Timely payments are crucial for maintaining good credit, avoiding financial stress, and ensuring uninterrupted services. Types of Payment Due Dates 1. Recurring Payments: Regular payments, such as monthly bills. 2. One-Time…
A minimum payment is the smallest amount that must be paid on a debt, such as a credit card balance, loan, or mortgage, to avoid late fees and penalties. While making minimum payments may seem convenient, it can lead to prolonged debt repayment and increased interest costs. Types of Minimum Payments 1. Credit Card Minimum…
A balance transfer is the process of transferring outstanding debt from one credit card to another, often with a lower interest rate or more favorable terms. This strategy can help individuals and businesses manage debt, save money on interest, and simplify finances. Types of Balance Transfers 1. Credit Card Balance Transfer: Transfer credit card debt….
A rewards program is a marketing strategy that incentivizes customers to engage in desired behaviors, such as repeat purchases or referrals, by offering tangible benefits and rewards. Effective rewards programs foster loyalty, drive sales, and enhance customer experience. Types of Rewards Programs 1. Points-Based Program: Earn points for purchases, redeemable for rewards. 2. Cashback Program:…
A home mortgage is one of the biggest loans that most people will ever take out, allowing them to buy a home with a repayment term that can last multiple decades. Because a mortgage (and its terms) will likely follow you for many years to come, it’s important to choose the right lender from the…
Buying a home is a long-term commitment. Since you’ll be working with your mortgage lender for years to come, putting in the work to find the best mortgage lender at the beginning of your search can pay off. Though most of the mortgage process is the same with any lender, shopping around can help you…