FDIC Borrowing Basics: Loans, Credit Principles & Banking Fundamentals
Explained
Annual Percentage Rate (APR) - ✔✔The cost of your loan expressed as a yearly percentage
rate.
Credit - ✔✔The ability to borrow money.
Collateral - ✔✔The security you provide the lender.
Consumer Installment Loan - ✔✔A loan used to pay for personal expenses for you and your
family over asset term or period of time.
Credit Cards - ✔✔Plastic cards with magnetic strips on the back (You buy goods or services and
pay for them over time - receiving a bill each month)
Fixed Rate - ✔✔The internet rate stays the same throughout the term of the loan.
Guarantee - ✔✔A form of collateral (the security you provide the lender.
Home Equity Loan - ✔✔A loan that allows a homeowner to borrow money that is secured by
his their home.
Home Purchase Loan - ✔✔A loan for the purpose of buying a house.
Home Refinancing Loan - ✔✔A loan that allows a homeowner to borrow money that is
secured by their home.
Explained
Annual Percentage Rate (APR) - ✔✔The cost of your loan expressed as a yearly percentage
rate.
Credit - ✔✔The ability to borrow money.
Collateral - ✔✔The security you provide the lender.
Consumer Installment Loan - ✔✔A loan used to pay for personal expenses for you and your
family over asset term or period of time.
Credit Cards - ✔✔Plastic cards with magnetic strips on the back (You buy goods or services and
pay for them over time - receiving a bill each month)
Fixed Rate - ✔✔The internet rate stays the same throughout the term of the loan.
Guarantee - ✔✔A form of collateral (the security you provide the lender.
Home Equity Loan - ✔✔A loan that allows a homeowner to borrow money that is secured by
his their home.
Home Purchase Loan - ✔✔A loan for the purpose of buying a house.
Home Refinancing Loan - ✔✔A loan that allows a homeowner to borrow money that is
secured by their home.
