In the context of CreditFresh, available credit is the Credit available for withdrawal on your account. No draws are permitted if you are Delinquent (i.e. late on any payment) or in Default.
Short for Automated Clearing House, ACH payments are authorized electronic fund transfers that are automatically debited from your bank account. We encourage you to pay down your CreditFresh Line of Credit using ACH payments.
The time between the dates of regular periodic statements.
In the context of CreditFresh, a draw on a Line of Credit.
An arrangement where a lender provides a borrower with money, and the borrower repays the initial amount borrowed (and in most cases additional interest or fees) at a future date.
An agency that gathers and compiles information from creditors to judge the consumer’s ability to repay debts. A lender might use the consumer’s credit report from a credit bureau to help assess a consumer's credit application.
An inquiry made to a credit bureau to receive information that can be used to help determine a consumer’s creditworthiness.
A record of a borrower’s repayment history for previous debts. A lender may request a consumer’s credit history from a credit bureau and use it as a tool to gauge the consumer’s likelihood of debt repayment.
The maximum amount of credit that a lender will provide to a consumer. In the context of CreditFresh, a customer’s approved credit limit is the upper limit on the amount they can borrow.
A report that is typically compiled by a credit bureau with information such as your previous payment history on debts from banks, credit card companies, collection agencies, governments and other creditors.
A score that is calculated based on previous behavior such as how and when a consumer paid their bills in the past. A lender may use this score to determine a customer’s likelihood of debt repayment in the future.
In most cases, when a borrower misses one or more payments on their loan, a creditor will consider that borrower to be in default.
The status of a borrower’s account when they are behind on repaying their loan.
Funds that are withdrawn from one account and deposited in another.
For a Line of Credit agreement, the effective date refers to the date on which the agreement comes into effect – this means that on this date, you can start taking cash advances up to your available Credit Limit. The Effective Date of a cash advance is the day when the requested funds are supposed to be received by the borrower.
Fair Isaac Corporation (FICO) Score:
Created by the Fair Isaac Corporation, FICO is the first credit score representing a person’s ability to repay a loan.
A person or company that extends credit to a borrower based on terms that both parties agree to as set out in an agreement.
Line of Credit (LOC):
An open, revolving loan that a customer can periodically draw down from up to their Approved Credit Limit.
An arrangement where a lender provides funds to a borrower based on an agreement that the amount will be repaid (and in most cases with interest or fees).
Line of Credit Agreement:
A legally-binding document which details the terms and conditions of a Line of Credit.
In the context of a Line of Credit, the minimum amount required to be paid to for each billing cycle, as detailed in the Periodic Statement. In the context of CreditFresh, the Minimum Payment will include both the applicable Billing Cycle Charge and a payment towards your Outstanding Principal Balance.
A lender that operates online and who may or may not have a physical storefront.
A form of loan with no fixed term or end date. They are sometimes called revolving loans since a borrower can draw from it more than once up to their Available Credit Limit. A Line of Credit is an example of an open-ended loan.
The unpaid balance on a debt.
Outstanding Principal Balance:
The amount of money a borrower owes, excluding any interest or fees incurred.
The amount of a payment that is applied towards paying down the outstanding amount borrowed.
A document that details the activity on a Line of Credit account including withdrawals, payments and charges assessed for a particular Billing Cycle.
References are often used by lenders in the event they cannot reach a borrower. A borrower may be asked to provide the name and contact info of their references as part of the application process.
A principle of treating consumers fairly by considering their interests. Ensuring transparency and working with borrowers to get their accounts back into good standing if they experience difficulties in repayment are core to responsible lending practices.
A form of credit where once approved, a borrower will have access to funds up to their Available Credit Limit.
The date that a Periodic Statement is generated.
Truth in Lending Act (TILA):
A federal law created to promote the informed use of credit by consumers. Amongst other things, TILA requires creditors to disclose terms and costs of credit to consumers in a clear, consistent manner to help consumers evaluate the costs associated with credit products.
A loan where a lender relies solely on the borrower’s ability to repay. This is different from a secured loan requiring the borrower to provide collateral that the lender could make a claim against in the event the amount borrowed is not repaid on a timely basis.