Once you're financially back on track, a good habit to get into is to 'pay yourself' every payday. Simply, it is taking 5% or 10% (if you can save more, that's a bonus) of your paycheque and setting it aside in a separate bank account. Or put it towards paying off a GIC loan, like above (if you get a demand loan for the GIC, that's the best, because you can pay off as much as possible as often as possible). The idea is to establish some financial discipline. You want to do things and achieve success - well, you need money. Saving 5% or 10% is not as big a sacrifice as you might think; after a while and a bit of adjustment you won't even notice it.

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Financial Terms and Definitions Defined

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DEFINITIONS:

Amortize: Provision for repayment of a loan in periodic payments over a stated period.
Arbitration: A dispute resolution mechanism, whereby an independent neutral third party is appointed to hear and consider the merits of the dispute, and who renders a final and binding decision called an award.
Assets: What you own or can call upon, an item or property having a monetary value or use and owned or controlled by a person, company or institution. It is often used in determining net worth or in secure financing. Houses, real estate, cars, jewelry, and stocks & bonds are considered assets.
Automated Teller Machine (ATM): Unmanned equipment used to obtain financial services, activated by a plastic card, push buttons, and a personal identification number (PIN) for each user.
Available Credit: On a credit account, the credit limit minus the current balance. To creditors, your total available credit on all your accounts is an important factor.

BIA: Bankruptcy and Insolvency Act
Balance: The outstanding amount owed to a creditor on a particular account.
Bank: An institution that acts as a financial intermediary by receiving money from depositors and lenders and also lending to borrowers. A bank must be chartered through the government and meet certain criteria.
Bank Account: An account that holds funds within a bank and is subject to additional deposits and withdrawals.
Bankrupt/Bankruptcy: A proceeding in Canada that may legally release a person from repaying some or all debts owed.
Borrowing: Incurring an obligation to repay a debt in order to invest or consume more than one currently owns.
Bonds: Usually a fixed interest security under which the issuer (say, the government or a company) contracts to pay the lender (you, if you buy a bond) a fixed principal amount at a stated date in the future, and a series of interest payments, either semi-annually or annually.
When you buy a bond you are, in effect, lending money to the city, company, or other entity that issued it. In return, the user pays you interest. There are many kinds of bonds. When you buy a Canada Savings Bond, for example, you’re helping to finance the federal deficit. Corporate bonds are bonds issued by companies. Junk bonds are high-interest, high-risk bonds issued by relatively uncredit-worthy borrowers.
Break-even: Make neither profit nor a loss, as in business, gambling, or a competitive sport.
Budget: A financial plan for both saving and spending money.
Business Bankruptcy: Bankruptcy filed by a corporation or by an individual whose commercial debts account for more than 50% of the value of his/her total debts.
Business Proposal: Proposal filed by a corporation or by an individual whose commercial debts account for more than 50% of the value of his/her total debts.

Capital: Capital is usually measured in terms of actual cash or what property can be quickly converted to cash: bank deposits, bonds, stocks, certificates and so on. It is a measure of your current assets. Capital reassures a lender by providing a means of repaying your loan in case you default.
Card Holder Agreement: The written statement that gives the terms and conditions of a credit card account. It must include the Annual Percentage Rate, the monthly minimum payment formula, annual fee, if applicable, and the cardholder's rights in billing disputes. Changes in the cardholder agreement may be made, with written advance notice, at any time by the issuer.
Cash: Cash usually refers to money in the form of currency, such as bills or coins. Cash can also refer to checks, money orders, cashier's checks, bank drafts, or traveler's checks, all of which can be quickly converted to cash. Cash is the most ‘liquid’ form of asset.
Cash Advance: A cash loan taken out on a credit card. Interest for cash advances is usually higher than for purchases, a transaction fee may apply, and the grace period may be waived.
Cash Cards: Cash cards are similar to prepaid phone cards and contain a set amount of value, which can be read by a special cash card reader. Participating retailers will use the reader to debit the card in increments until the value is gone. The cards are like cash, so if lost or stolen they can be used by anyone.
Charge Card: A card used for charging purchases, with outstanding balances due and payable in full immediately upon billing. Unlike a credit card, which gives a borrower a revolving line of credit to borrow against and permits carrying a balance with an agreed-to interest rate, charge cards do not allow carrying a balance and no interest is charged.
Examples of charge cards are American Express and Diners Club cards. Such cards will still appear on your credit report, since they do extend credit to you.
Chattel: An asset that is moveable (eg: furniture) and not attached to land (eg: a house) or real property.
Cheque: A negotiable bank instrument, payable on demand, that instructs a bank to pay the indicated amount to the party named on the cheque from funds held on deposit.
Chequing Account: A personal account at a financial institution like a bank, trust company or credit union permitting the account holder to write cheques. Savings accounts, by comparison, do not allow that privilege.
Collateral: Any asset or property – for example, a term deposit, Canada Savings Bond or automobile - that you have given or committed as security or a guarantee for a loan. The creditor has a lien or mortgage on the collateral and can seize it if payment is in default.
Collection Agency: A company that collects debts for other people or companies called creditors.
Compound Interest: Interest charged not only to the principal sum but also on interest amounts charged in a preceding period.
Consolidation Loan: A loan obtained in order to combine multiple debts into one, typically at a lower rate of interest..
Consumer: A person who uses credit to purchase products and services for personal, family or household purposes.
Consumer Credit: Loans for personal or household use as opposed to business or commercial lending. Loans are generally ‘unsecured’ (not backed by collateral).
Loans, credit card transactions and purchases of goods or services where the price is not paid in full at the time of sale are common forms of credit arrangements.
There are three basic types of consumer credit:
1) Credit Sales: usually through a retailer. If you buy an item at a retail store you may have to sign a Conditional Sales Contract and/or a Promissory Note detailing the repayment schedule.
2) Credit Cards: available from any number of sources. Banks, trust companies and credit unions, and department stores are just some of the institutions which offer consumer credit.
3) Cash Loans: usually made through banks, trust companies, credit unions, and finance companies who lend money at either fixed or variable rates of interest. The money is repaid over a set period of time. Larger cash loans usually require collateral.
Consumer Debt: Debt incurred for items that aren't considered tangible investments; in other words, personal as opposed to business purposes. Some examples are credit card debt, car loans, a personal line of credit, Conditional Sales Contracts (buying furniture or appliances on time).
Consumer Debtor: Individual with more than 50% of liabilities related to consumer spending
Co-Signor (or Guarantor): A person with an established credit rating who guarantees to repay the credit card balance or loan balance for the borrower if the actual borrower fails to do so. A consumer with poor credit may require a co-signer to get a loan or to qualify for favorable terms. Because co-signers are liable for debts incurred, co-signed accounts appear on the cosigner's credit report.
Cost-of-Living: The average cost of a variety of expenses for living such as rent, transportation, insurance, utilities, etc.
Credit: When a lender extends funds to a borrower on a promise of repayment over a certain period in order that the borrower may buy goods or services now.
Credit Balance: This is the amount owed on a credit card. It is not to be confused with a minimum payment.
Credit Bureau (or Credit Reporting Agency): Commonly known as credit bureaus, credit reporting agencies are companies that receive, maintain, and provide information about consumers' credit history. Three national agencies -Equifax, Experian, and TransUnion -dominate the credit reporting industry.
They issue credit reports to credit bureau members – upon request and for a fee - that list how individuals manage their debts and make payments, how much unused credit they have available and whether they have applied for any credit.
Credit Check: When creditors verify the debts and payment history of a customer or applicant, usually by requesting a Credit Report report and verifying income with employers.
Credit (Bureau) Report (or File): Confidential report on a consumer's payment habits and overall credit history as reported by their creditors to a consumer credit reporting agency. It will also contain identifying information such as a date of birth, a last known address for the debtor, last known employment of the debtor and some public records such as Judgments and bankruptcies, if applicable. The report is most often used to help a credit grantor determine the debtor’s credit worthiness, but may also be used for employment purposes.
Someone with a good credit report is more likely to get a better interest rate and other terms than someone with a poor credit report.
Credit Card: A form of revolving credit where a minimum payment is required and interest is charged on any outstanding balance. MasterCard and VISA are two good examples.
Credit Counselling/Credit Management: (see Debt Counselling/Debt Management)
Credit History: The information found on a Credit (Bureau) Report of File: how a consumer has paid credit accounts over a period of time and what he/she owes. It is used as a guide to determine whether or not the consumer is likely to pay future accounts on time.
Credit Insurance: Insurance coverage which will pay off any outstanding credit card debt in the event the borrower suffers job loss, dies or becomes disabled. The structure of protection for a revolving credit card debt is calculated each month to cover only the debt that existed at the last billing cycle.
Credit Limit/Credit Line: The amount of credit issued by a creditor to a debtor, and therefore the maximum amount of credit available. The borrower can use all or part of the credit granted him/her but only up to that set amount.
Creditor: A person to whom money, goods or services are owed by another. For consumer finance purposes we usually think of banks, credit unions, trust companies and credit card companies as creditors.
Credit Rating: A judgment by a credit grantor of someone's ability to repay debts, based on current and projected income, the history of payment of past debts. This decision is sometimes expressed as a number called a credit score.
Credit Risk: This is the likelihood of a consumer to pay back an outstanding debt. The credit application, Credit Bureau Report and credit score are all factors to a credit grantor in coming to such a decision.
Credit Scoring: A numerical system designed to assesses a borrower on a number of items and assigns points used to determine the borrower’s credit worthiness. It is a tool used by credit grantors to provide an objective means of determining risks in granting credit: in other words, it measures the likelihood that the borrower will repay a debt. Values are assigned to such items as time on the job/with the same employer, previous debt payment habits, and so forth.
Credit Union: A nonprofit, cooperative financial institution owned, controlled and operated by the people (‘the members’) who use its services. Otherwise it functions very similarly to a bank in providing such services as accepting deposits and lending money. Credit unions historically have been competitive with banks, able to offer lower rates and fees.
Credit Worthiness: The ability of a consumer to receive favorable consideration and approval for the use of credit from an establishment to which they applied, based on an assessment of a consumer's past credit behavior that allows a potential lender to decide whether or not to extend credit.

Debit Card: A payment card linked directly to a customer's bank account and which allows purchases to be deducted directly from that account. Some cards require a personal identification number, others a customer's signature. A PIN-based (or direct debit card) removes a purchase price from a customer's checking account almost immediately, while a signature-based (or deferred debit card) has a Visa or MasterCard logo and removes the purchase price from a customer's bank account in two or three days.
Debt: Money, goods, or services that one party is obligated to pay to another.
Debt Consolidation: Combining multiple loans into a single loan, often with a lower monthly payment, a lower interest rate and/or a longer repayment period. It's also called a consolidation loan.
Debt Counselling/Debt Management (same as Credit Counselling/Credit Management): Both for-profit and nonprofit organizations which help consumers find a way to repay debts through careful budgeting and management of funds. These counselling services can often work out a successful repayment plan by requesting creditors accept a longer period for repayment as well as substantially reduce interest charges.
Debt Service Ratio (sometimes called a Total Debt Service Ratio): A calculation to determine a borrower’s capacity to repay a loan. It is the percentage of the borrower’s gross income used to make total monthly payments.
Debt-to-Income Ratio: Your income compared to the debt you owe.
The percentage of before-tax earnings spent to pay off loans for such obligations as car loans, student loans and credit card balances. There are in fact two ratios lenders look at. The first is a ‘front-end ratio:’ the percentage of monthly before-tax earnings that are spent on house payments (including principal, interest, taxes and insurance). In the second, the ‘back-end ratio’, the borrower's other debts are factored in.
Debtor: Anyone – an individual, a company, a government - which owes money, goods or services.
Default: Failure to pay a debt based on the specific terms and conditions of the debt agreement. One example of default is to simply stop making the required payments. When this happens the lender has a number of options to collect the balance in full.
Defaults are a serious negative item on a credit report, and are reported as ‘delinquency.’
Delinquent/Delinquency: This is a measurement indicating a past-due payment (or payments) on debts. Debts are classified into categories according to the time past due, typically 30, 60, 90 and 120 days, and so on, past due. Special classifications also include charge-off, repossession, etc.
Demand Loan: A loan where the balance must be repaid immediately upon the lender’s request at any time. If you are a low-risk customer, that is, if you will have little trouble repaying the loan or if you have assets (‘security’) to cover the loan, you may get a demand loan. The interest rate with demand loans is usually variable. You repay over time as with installment loans. Loan payments can vary from month to month but you will have to make a minimum payment.
Deposit: Cash, cheques, or drafts placed into a member's bank, trust company or credit union account for credit and safekeeping.
Direct Deposit: Having funds - such as payroll, pension, or disability - sent electronically direct into an individual's account at their bank, credit union or trust company.
Discretionary Income: The money you have left over when all expenses and other financial obligations have been paid.
Disposable Income: Personal income less income taxes and other mandatory deductions (CPP contributions, EI premiums, etc.) paid to government.
Down Payment: The initial amount paid toward the total price of (usually) a major purchase like a house or car. It is typically a small portion of the total purchase price. A large down payment may help you negotiate more favourable interest rates and terms.
Draft: An rder for money to be paid by a financial institution, be it a bank, trust company or credit union.

Earned Income: For Canadian tax purposes, earned income is generally the money made by an individual from employment. It also includes some taxable benefits. Earned income is used as the basis for calculating RRSP maximum contribution limits.
Earnings: Income is the money received as a result of the normal business activities of an individual or a business. For example, most individuals' income is the money they receive from their regular paycheques. See Income.
Electronic Funds Transfer (EFT): Any transfer of funds (other than a transaction originated by cheque, draft, or similar paper instrument) that is initiated through an electronic terminal, telephone, computer or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit an account.
Emergency Funds: A category usually found within a budget which sets aside money for unexpected circumstances. It may be a percentage of the monthly income, or a certain specific amount each month.
Equity: The difference between the value of an asset and the debt(s) against it.
Estates: Under the Bankruptcy and Insolvency Act, the name given to the file of someone who has assigned into bankruptcy. Essentially, an estate consists of the entire financial situation – assets and liabilities – of a bankrupt.
Finance Charge: The cost of a loan expressed as a dollar amount.

Finance Companies: A company that mainly lends money to consumers who cannot qualify for credit at a credit union, bank or trust company. Finance companies generally charge higher rates than other creditors.
Financial Planner/Advisor: A professionally qualified individual who has the expertise to advise you in general terms on all aspects of your finances.
Fixed Interest Rate: A Fixed Interest Rate is one which remains constant - regardless of economic indicators or market conditions - for the term of the loan. Compare to Variable Interest Rate. Fixed rates can apply to mortgages, business loans and consumer loans. They tend to be higher interest rates than flexible (or variable) rate loans because lenders are not protected against a rise in the cost of money when they make a fixed rate loan.
Foreclosure: A legal process usually relating to real estate in which the lender takes ownership of the property due to the default of payment by the borrower. The lender may then sell the seized property in order to satisfy the mortgage claim and costs.

Garnishment: A legal process whereby a creditor can seize a portion of the debtor’s liquid assets (wages, bank accounts, etc.). This is usually following obtaining a Judgment (ie: successfully suing the Debtor), although Pre-Judgment Garnishees are sometimes executed, particularly if there exists a possibility the funds may only be available for a short while.
Grace Period: A portion of time in which no interest is charged.
Gross Income: Your earnings before any taxes, pension contributions or other deductions are taken off.
Guaranteed Investment Certificates (GICs): A deposit issued for a stated period of time and normally paying a fixed rate of interest.

History: Statement of past transactions having occurred on an account.
Home Equity: The portion of your home you actually own over and above encumbrances like mortgages (or the home's current market value minus the amount you still owe). See Home Equity Loan.
Home Equity Loan: A loan secured by a primary residence or second home to the extent of the excess of fair market value over the existing debt (usually mortgages) against it.
Household Income: The total income of all members of a household. This is an important yardstick used by lenders evaluating applications for joint credit.

Identity Theft: A very fast-growing crime that occurs when someone uses your personal information to fraudulently obtain credit. If you become a victim, it could take years to sort out.
Income: Income is the money that is received as a result of the normal business activities of an individual or a business. For example, most individuals' income is the money they receive from their regular paycheques. See Earnings.
Inflation: The rise in price of goods and services, when too much money chases too few goods on the market. Moderate inflation, the result of economic growth, is generally acceptable. However, hyperinflation (rising at rates of 100% or more annually) causes people to lose confidence in their economy and convert their money into hard assets such as gold and real estate.
Insolvency: Means both bankruptcies and proposals.
Instalment Loan: A loan in which the amount of the payment and the number of payments are predetermined or fixed.
Insurance: A promise of reimbursement or compensation in the event of loss of life or property.
Interest: Interest is the amount it costs you to borrow money or purchase goods or services for which you will pay later. If you borrow $100 and you end up repaying $110, the extra $10 is interest.
Interest-Only Loan: A loan on which only the monthly interest cost is paid each month. The full principal balance remains outstanding. This is a common feature of Lines of Credit.
Interest Rate: The amount of interest, expressed as an annual percentage, charged by creditors for you to borrow money. The rate varies according to the type of loan, be it personal, mortgage or business.
Investment: The use of money to create more money.
Involuntary Bankruptcy: A bankruptcy instigated by creditors rather than the debtor.

Joint Account: A deposit or loan account held by two or more people. All account holders equally assume legal responsibility for the repayment of the account.
Judgment: A determination by a court of law that, in the case of credit, requires a person to fulfill an obligation - to pay a debt, for example. When a Judgment has been satisfied (i.e. the debt has been paid or settled), the Judgment Debtor is no longer liable. Information about Judgments is recorded in the public records section of a credit report.

Late Charge: Percentage of the payment due that is charged for being late or paying after a predetermined grace period.
Late Payment: A payment made after its legal due date. Payments that are late by 30 days or more may be reported to credit reporting agencies and added to your credit report.
Lender: Any person, business or government who lends money, thus enabling the borrower to make purchases on credit. See Creditor.
Lending: To provide money on the condition that the amount borrowed be repaid and usually with interest.
Liabilities: The debts of a person, business or government.
Liability: In the context of credit, the borrower’s legal responsibility for the repayment of a debt.
Lien: A creditor’s legal claim upon real or personal property as security for or payment of a debt.
For example, a mortgage is a lien against a house; if the mortgage payments are not made, the house can be seized and sold to satisfy the lien. Similarly, a bond is a lien against a company's assets; if interest and principal are not paid when due, the assets may be seized to pay the bondholders. As soon as a debt is paid, the lien is removed.
Line of Credit (also known as a Personal Line of Credit, or PLC): A floating (or variable) rate loan, which establishes a specific amount of credit available that can be accessed at any time for any purpose.
These are set up at banks, trust companies or credit unions for customers with enough income, assets and an active chequing account.
Living Wills: A document outlining the life-prolonging measures an individual wants and does not want taken on his/her behalf in the event of a terminal illness. Living wills are often used in conjunction with a healthcare power of attorney, which appoints someone to make healthcare decisions on the individual’s behalf.
Loan: An extension of money by a lender to a borrower that is to be repaid by the borrower within a specified period, usually accompanied by interest.
Loan Application: A loan application is a document in which a prospective borrower details his or her financial situation in order to qualify for a loan.

MasterCard: MasterCard, a product of MasterCard International, is distributed by issuing financial institutions around the world. Card holders borrow money against a credit line and pay it back with interest if the balance is carried over from month to month.
Maturity Date: A date on which the principal amount of a debt becomes due and payable or otherwise paid in full.
Mediation: An alternate dispute mechanism whereby a mediator acts as a facilitator assisting the disputing parties in coming to a mutually agreed settlement.
Minimum Payment: The minimum amount you can make on a revolving credit account in order to maintain your account status as being paid as agreed and retain all the privileges which accompany that account. Most card issuers require a minimum payment of 2 percent of the outstanding balance. Do not confuse this term with a credit balance.
Money: The official currency issued by a government or national bank
Money Order: A document issued by a bank, credit union, trust company or other financial institution allowing the individual named on the order to receive a specified amount of cash on demand.
Mortgage: A loan designed to facilitate the purchase of a home, in which the home itself serves as security for the loan. The borrower has the use of the property. However, if the borrower (the mortgagor) doesn't make the required payments, the lender (the mortgagee) may through a legal process known as foreclosure and sell the home in order to recover the amount owed on the mortgage. "Mortgage" can also refer to the legal document detailing the borrower's responsibilities, including the payment schedule and terms.
The mortgage is removed from the Property Title when the obligation is fully paid. A mortgage normally involves real estate. For personal property, such as machines, equipment, or tools, the lien is called a "chattel mortgage."
Mortgagee: The person/financial institution who lends money using a mortgage.
Mortgagor: The person who borrows money using a mortgage.

Net Income: Your total income from employment and other sources, minus taxes.
Net Worth: The total value of all assets, such as house, car, furniture and investments, minus all debts, such as mortgages and credit card bills.
NSF (non-Sufficient Funds) Cheques: A cheque drawn against an account in which there is insufficient money to cover the amount of the cheque.

OSB: Office of the Superintendent of Bankruptcy
Overdraft: The amount that a cheque exceeds the available balance in the payer's account; also insufficient funds.
Overdraft Protection: Revolving credit used primarily to ensure chequing account overdrafts are “covered,” eliminating the cost and embarrassment of NSF cheques.

Pensions: A pension (also known as superannuation) is a retirement plan intended to provide a person with a secure income for life.
Personal Consumption Expenditure: This is the sum total of expenditure on food and beverages, clothing, housing, furniture, medical care, transportation, communications and recreation
Personal Identification Number (or PIN): A confidential personal identification code, usually consisting of four to six digits, used by bank customers to access their account balances when using a self-service automated teller machine (ATM).
Personal Saving: Personal income less consumption expenditure, taxes and any transfers to government, corporations and non-residents.
Personal Savings Rate: Personal savings as a percentage of personal disposable income.
Power of Attorney: A legal document in which the signer authorizes someone to conduct certain specific business in his or her name -signing title documents and cheques, for example.
Pre-Approved: A credit card offer with "pre-approved" only means that a potential customer has passed a preliminary credit-information screening. A credit card company can spurn the customers it initially invited if it doesn't like the applicant's credit rating.
Prepayment Penalty: A fee assessed by a lender when you pay off your loan ahead of schedule. The penalty compensates the lender for interest payments it would have received based on the loan's payment schedule. It is especially common with mortgages.
Primary User: The person under whose name a credit card account is listed. A primary user can authorize other people to use the account, but the primary user is ultimately responsible for repaying all charges.
Prime Rate: The interest rate charged by banks on loans to their largest and highest-rated customers. This economic indicator often serves as the basis for variable interest rates.
Principal: The portion of a loan which is exclusive of interest and other charges.
Promissory Note (often called, simply a Note): A written promise committing the borrower (payor) to pay the Lender (payee) a specified sum of money, either on demand or at a determinable future date, with or without interest, according to the terms of the contract.
Property: Anything real and personal, tangible and intangible, that may be the subject of ownership. It is that which belongs exclusively to a person, with full rights to enjoy and dispose of it. Real property is land and everything growing on it, and it may further be defined to include anything that is immovable. Personal property is all property other than real property and is generally refers to property that is movable.
Proposal: Proposal from a debtor to his or her creditors.
Public Record: Information obtained from court records about such things as assignments into bankruptcy and Judgments against you.

Qualifying Ratio: This is the ratio of your monthly expenses to your gross monthly income. Creditors use such ratios to evaluate loan applications.

Real Estate: Land and all physical property on, below or attached to the land. Houses, sewers, trees and fences are all considered real estate.
Receiver: An appointed or otherwise authorized official who oversees the property of a debtor in serious financial trouble. This official will either manage the property for the purpose of enforcing a lien against it or for the general distribution of the item(s) to the debtor’s creditors.
Recession: A prolonged period (usually defined as two successive quarters, or 6 months in total) in which economic activity shrinks.
Recurring Debt: Debt that occurs periodically, including such obligations as credit card payments, child support, car loans, and others that will not be paid off within a relatively short period of time (6-10 months).
Remaining Balance: This is the remaining unpaid principal of a loan, exclusive of interest and other charges.
Repayment Plan: Modification of an existing loan after the borrower has been delinquent and used when the borrower misses payments but the lender does not foreclose. Usually the terms of the loan agreement are changed to make it easier for the borrower to maintain payments.
Repossession: The act of a creditor regaining possession of an item sold to you. This usually occurs only when the contractual payments have stopped.
Retirement: Retirement is the status of a worker who has stopped working. This happens upon reaching a determined age, when physical conditions don't allow the person to work any more (by illness, disease or accident), or by personal choice (usually in the presence of an adequate pension).
Revolving Charge/Credit/Account: This is open-ended credit - usually up to a pre-established credit limit - with no fixed repayment period or amount but may require a minimum payment to cover interest and some principal reduction. Revolving credit may be used whenever the borrower wishes and for any purpose.
This type of credit is typical of credit card loans, chequing accounts or overdraft accounts that have pre-approved lines of credit.

Safety Deposit Box: A safe deposit box (or safety deposit box) is a type of safe usually located in groups inside a vault or in the back of a bank or post office. It usually holds things such as jewels, cash, or important documents such as wills or property deeds that a person might feel afraid to leave at home due to fear of theft, fire, or flood.
Satisfied: A Judgment is satisfied when the debtor has fulfilled the Judgment’s requirements - paid the outstanding amount, for example - and is thus no longer liable.
Savings Account: A personal account at a financial institution like a bank, trust company or credit union restricting the account holder to earning interest only. Chequing accounts, by comparison, do not allow that privilege.
Second Mortgage: A mortgage taken out on a home that has an existing mortgage. A Home Equity Loan is a type of second mortgage.
Secured Credit Card: A secured credit card is one in which the financial institution issues a card with a maximum that is equal to a deposit that the cardholder puts down. These cards are a good choice for people trying to establish or rebuild credit.
Secured Debt/Loan: Are debts/loans guaranteed by the borrower pledging collateral. A mortgage is an example of a secured loan.
With secured debts, if a debtor misses a payment, the creditor has the right to seize and sell those goods used as collateral for the debt.
Security: Something given or pledged as collateral to a person who is lending money in order to secure or guarantee payment of that debt. Should the borrower fail to repay, the creditor may take ownership of the property by following legally mandated procedures.
Shares/Stocks: Ownership units of an enterprise, usually a company, which could be either private or traded publicly.
Simple Interest: Interest computed only on the principal balance, without compounding.
Statement: detailed record of transactions in a bank customer's account(s) for a certain period, usually each month, which shows debits, credits, transfers, payroll deposits, account balance, check fees, service charges, ATM activity, etc. Interest calculation based only on the original principal amount. Simple interest contrasts with compound interest, which is applied to principal plus accumulated interest.

Term: The amount of time given for a loan to be repaid in full.
Third Party Collections: see Collection Agency.
Total Expense Ratio: The percentage of monthly debt payments compared to total before-tax income.
Transaction Date: The date that goods or services were purchased or the date the cash advance was made.

Unsecured Debt/Loan: This is credit for which no collateral has been pledged. Loans made under this arrangement are sometimes called ‘signature’ loans; in other words, a loan is granted based only on the customer's word, through signing an agreement, that the loan amount will be paid. Unlike conditional sales contracts and chattel mortgages, an unsecured debt gives the creditor no additional protection or guarantee that the debtor will repay the money. The creditor essentially is relying on the debtor’s good faith and promise to pay.
An example of unsecured debt is the use of credit cards. The risk of default is a main reason why such unsecured debt has an interest rate higher than other forms of lending, such as mortgages, which employ property as collateral.
Compare to Secured Debt/Loan.
Usurious Rate/Usury: An unnecessarily high interest rate – usually prescribed by law – is called a usurious rate, while the practice of lending money at such rates is considered usury.

Variable Interest Rate: An interest rate that changes according to a predefined formula based on an economic indicator such as the prime rate. For example, a credit card's annual percentage rate might be the prime rate plus 5%. Compare to Fixed Interest Rate.
VISA: VISA cards, a product of VISA USA, are distributed by financial institutions around the world. A VISA card holder borrows money against a credit line and repays those funds with interest if the balance is carried over from month to month in a revolving line of credit.
Voluntary Bankruptcy: A bankruptcy filed at the consumer's request (or ‘assignment.’)

Wills: In law, a will or testament is a documentary instrument by which a person (the testator) regulates the rights of others over the testator's property or family after their death.

Zero Balance: What shows on a credit card customer's bill when the outstanding balance has been paid and no new charges have been incurred during the billing cycle. This is always a ‘good thing.’