Banking — page 2 of 5

Banking terms

101. Credit Card Issuer Any financial institution that issues bank cards to those who apply for them.
102. Credit Disability Insurance A type of insurance, also known as accident and health insurance, that makes payments on the loan if you become ill or injured and cannot work.
103. Credit Enhancement A form of guarantee, insurance, or other characteristic (e.g. Overcollateralization) of a security that improves its credit quality.
104. Credit Life Insurance A type of life insurance that helps repay a loan if you should die before the loan is fully repaid. This is optional coverage.
105. Credit limit The maximum amount of credit that is available on a credit card or other line of credit account.
106. Credit Repair Organization A person or organization that sells, provides, performs, or assists in improving a consumer's credit record, credit history or credit rating (or says that…
107. Credit Report A detailed report of an individual's credit history prepared by a credit bureau and used by a lender in determining a loan applicant's creditworthiness.
108. Credit Score A number, roughly between 300 and 800, that measures an individual's credit worthiness. The most well-known type of credit score is the FICO® score.
109. Credit Union A cooperative, nonprofit association, licensed under for the purposes of encouraging thrift among its members, creating a source of credit at a fair and…
110. Cumulative Loss Total Realized Losses as of a measurement date. This does not include implied writedowns, which are not recognized as losses.
111. Custodian Services This is a service whereby a person or entity agrees to hold and manage assets on behalf of another person or entity.
112. Cut-Off Time A time of day established by a bank for receipt of deposits. After the cut-off time, deposits are considered received on the next banking day.
113. Debit A debit may be an account entry representing money you owe a lender or money that has been taken from your deposit account.
114. Debit Card A debit card allows the account owner to access their funds electronically. Debit cards may be used to obtain cash from automated teller machines or…
115. debt adjuster Debt adjusters , according to Sec. 36a-656, must be nonprofit organizations. A bona fide nonprofit organization means an individual, partnership…
116. Debt Collector Any person who regularly collects debts owed to others.
117. Debt Elimination Scheme A debt elimination scheme is a plan that is advertised as a way for an individual to eliminate various types of debt simply by paying someone a small fee…
118. Debt-to-Income Ratio (DTI) (DTI) The percentage of a consumer's monthly gross income that goes toward paying debts. Generally, the higher the ratio, the higher the perceived risk.
119. Debtor Someone who owes monies to another party.
120. Decedent A deceased person, ordinarily used with respect to one who has died recently.
121. Default Default occurs when a debtor is unable to meet the legal obligation of debt repayment, one form of which is the failure to promptly pay interest or…
122. Default Rate ​The annualized rate at which the loans underlying a security have defaulted. Also known as the Conditional Default Rate, or CDR.
123. Deferred Payment A payment postponed until a future date.
124. Delinquency A debt that was not paid when due.
125. Demand Deposit A deposit of funds that can be withdrawn without any advance notice.
126. Deposit Slip An itemized memorandum of the cash and other funds that a customer presents to the bank for credit to his or her account.
127. Derogatory Information Data received by a creditor indicating that a credit applicant has not paid his or her accounts with other creditors according to the required terms.
128. Direct Deposit A payment that is electronically deposited into an individual's account at a depository institution.
129. Direct Dispute A dispute submitted directly to the furnisher about the accuracy of information in your consumer report that relates to an account or other relationship…
130. Disclosures Certain information that Federal and State laws require creditors to give to borrowers relative to the terms of the credit extended.
131. Draft A signed, written order by which one party (the drawer) instructs another party (the drawee) to pay a specified sum to a third party (the payee), at sight…
132. Drawee The person (or bank) who is expected to pay a check or draft when it is presented for payment.
133. Drawee bank The bank upon which a check is drawn.
134. Drawer The person who writes a check or draft instructing the drawee to pay someone else.
135. Electronic Banking A service that allows an account holder to obtain account information and manage certain banking transactions through a personal computer via the…
136. Electronic Check Conversion Electronic check conversion is a process in which your check is used as a source of information-for the check number, your account number, and the number…
137. Electronic Funds Transfer (EFT) (EFT) The transfer of money between accounts by consumer electronic systems-such as automated teller machines (ATMs) and electronic payment of bills-rather than…
138. Embezzlement In most States, embezzlement is defined as theft/larceny of assets (money or property) by a person in a position of trust or responsibility over those…
139. Encoding The process used to imprint or inscribe MICR characters on checks, deposits, and other financial instruments.
140. Enforcement Action A regulatory tool that the OCC may use to correct problems or effect change in a national bank.
141. Equal Credit Opportunity Act (ECOA) (ECOA) Prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age, or…
142. Error Resolution The required process for resolving errors involving electronic transfers to and from deposit accounts
143. Escheat Reversion of real or personal property to the State when 1) a person dies without leaving a will and has no heirs, or 2) when the property (such as a bank…
144. Escrow A financial instrument held by a third party on behalf of the other two parties in a transaction.
145. Escrow Analysis The periodic examination of escrow accounts by a mortgage company to verify that monthly deposits are sufficient to pay taxes, insurance, and other…
146. Escrow Funds Funds held in reserve by a mortgage company to pay taxes, insurance, and other mortgage-related items when due.
147. Estate Account An account held in the name of a decedent that is administered by an executor or administrator of the estate.
148. Exception Hold A period of time that allows the banks to exceed the maximum hold periods defined in the Expedited Funds Availability Act.
149. Excess Spread ​The extent to which the Weighted Average Coupon on the assets underlying an asset-backed security exceeds the coupon rate of that security plus any…
150. Fair and Accurate Credit Transactions Act of 2003 (FACT Act or FACTA) The purpose of this Act is to help consumers protect their credit identities and recover from identity theft.
151. Fair and Accurate Credit Transactions Act of 2003 (FACT Act,FACTA) (FACT Act,FACTA) The purpose of this Act is to help consumers protect their credit identities and recover from identity theft.
152. Fair Credit Reporting Act (FCRA) (FCRA) A Federal law, established in 1971 and revised in 1997, that gives consumers the right to see their credit records and correct any mistakes.
153. Fair Debt Collection Practices Act (FDCPA) (FDCPA) The Fair Debt Collection Practices Act is a set of United States statutes added as Title VIII of the Consumer Credit Protection Act.
154. Federal Deposit Insurance Corporation (FDIC) (FDIC) A government corporation that insures the deposits of all national and State banks that are members of the Federal Reserve System.
155. Federal Emergency Management Agency (FEMA) (FEMA) Federal agency responsible for the emergency evaluation and response to all disasters, natural and man-made.
156. Federal Reserve System The central bank of the United States. The Fed, as it is commonly called, regulates the U.S. monetary and financial system.
157. Fictitious Invoices It is common practice in the offshore industry to issue false invoices as a means to transfer money to an offshore jurisdiction, while at the same time…
158. Fiduciary Undertaking to act as executor, administrator, guardian, conservator, or trustee for a family trust, authorized trust, or testamentary trust, or receiver…
159. fiduciary capacity, non-banking corporations acting in a Certain corporations , other than banking institutions, are licensed by the Banking Commissioner to act as trustees.
160. field of membership The field of membership of a Connecticut Credit Union is limited to: a) a single common bond membership of occupation or association, b) a multiple common…
161. Finance Charge The total cost of credit a customer must pay on a consumer loan, including interest. The Truth in Lending Act requires disclosure of the finance charge.
162. Financial Regulatory Agency An organization authorized by statute for ensuring the safe and sound operation of financial institutions chartered to conduct business under that…
163. Financial Secrecy This term refers to the confidentiality afforded to financial transactions either by enactment of law or by other means.
164. First Mortgage A real estate loan which is in a first lien position, taking priority over all other liens.
165. first mortgage loan A first mortgage loan means a loan or an extension of credit, including, but not limited to, an extension of credit pursuant to a contract or an assigned…
166. Fixed Rate Loan The interest rate and the payment remain the same over the life of the loan. The consumer makes equal monthly payments of principal and interest until the…
167. Fixed Rate Mortgage A mortgage with payments that remain the same throughout the life of the loan because the interest rate and other terms are fixed and do not change.
168. Float 1) The amount of uncollected funds represented by checks in the possession of one bank but drawn on other banks.
169. Flood Insurance Flood insurance protects against water from an overflowing river or a hurricane's tidal surge and also covers damage from water that builds up during…
170. Flood Plain A strip of relatively flat and normally dry land alongside a stream, river, or lake that is covered by water during a flood.
171. Foreclosure A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default.
172. foreign banks with state branches A banking organization that is headquartered outside the United States, but wants a presence in the United States, most commonly establishes a branch or…
173. Foreign Transaction Fees A fee assessed by your bank for making a transaction at another bank's ATM.
174. Forged Check A check on which the drawer's signature has been forged.
175. Forgery The fraudulent signing or alteration of another's name to an instrument such as a deed, mortgage, or check.
176. franchise A legal agreement by which a company (franchisor) licenses its trade name and/or business system and practices for a fee to another (franchisee).
177. Fraud Alert A key provision of the Fair and Accurate Credit Transactions Act of 2003 is the consumer's ability to place a fraud alert on their credit record.
178. Freedom of Information Act (FOIA) (FOIA) A Federal law that mandates that all the records created and kept by Federal agencies in the executive branch of government must be open for public…
179. Frozen Account An account on which funds may not be withdrawn until a lien is satisfied and a court order or other legal process makes the account available for…
180. Furnisher An entity that provides information about a consumer to a consumer reporting agency for inclusion in a consumer report.
181. Garnishment Generally, garnishment is a court proceeding in which a creditor asks a court to order a third party who owes money to the debtor or otherwise holds…
182. Garnishment/Garnish A legal process that allows a creditor to remove funds from your bank account to satisfy a debt that you have not paid.
183. Guaranteed Student Loan An extension of credit from a financial institution that is guaranteed by a Federal or State government entity to assist with tuition and other…
184. Guarantor A party who agrees to be responsible for the payment of another party's debts should that party default.
185. High net worth individual Any individual whose net worth is greater than $2 million immediately before the transaction.
186. Hold Used to indicate that a certain amount of a customer's balance may not be withdrawn until an item has been collected, or until a specific check or debit…
187. Home Equity Line of Credit (HELOC) (HELOC) A line of credit secured by the equity in a consumer's home. It can be used for home improvements, debt consolidation, and other major purchases.
188. Home Equity Loan A home equity loan allows you to tap into your home's built-up equity, which is the difference between the amount that your home could be sold for and the…
189. Implied Writedown Calculated based on the under-collateralization of a security, or any shortfall between a security's collateral pool balance and the aggregate unpaid…
190. Inactive Account An account that has little or no activity; neither deposits nor withdrawals having been posted to the account for a significant period of time.
191. Index-linked Certificate of Deposit An index-linked CD is a deposit obligation of the issuing bank and is often sold through bank branches and affiliated and unaffiliated brokers.
192. Individual Account An account in the name of one individual.
193. Individual Retirement Account (IRA) (IRA) A retirement savings program for individuals to which yearly tax-deductible contributions up to a specified limit can be made.
194. Insufficient Funds When a depositor's checking account balance is inadequate to pay a check presented for payment.
195. Insurance (Hazard) Insurance to protect the homeowner and the lender against physical damage to a property from sources such as but not limited to fire, wind, or vandalism.
196. Insured Deposits Deposits held in financial institutions that are guaranteed by the Federal Deposit Insurance Corporation (FDIC) against loss due to bank failure.
197. Interest The term interest is used to describe the cost of using money, a right, share, or title in property.
198. Interest rate The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time.
199. Interest Rate Index A table of yields or interest rates being paid on debt that is used to determine interest-rate changes for adjustable-rate mortgages and other…
200. International Business Corporation (IBC) The term international business corporation or IBC refers to a corporation formed in an offshore financial secrecy jurisdiction which is afforded certain…