An account represents a relationship between a company (the account owner) and consumer, where the consumer purchases a product or service in such a way that represents the transfer of money over time.
The person(s) and or guarantor(s) in whose name an Account was established; the person or entity who or which is obligated to repay an Account, or if there are multiple persons or entities obligated to repay an Account, all such persons or entities collectively; the obligor or obligors on an Account.
An unfavorable action, such as the denial of credit, insurance or employment, taken by a creditor or other entity, affecting a consumer. Under the Fair Credit Reporting Act (FCRA), creditors must disclose the reasons for any adverse action.
The amount of money that you owe to a particular lender.
A legal proceeding that relieves you of the responsibility of paying your debts or provides you with protection while attempting to repay your debts.
The release, by the Bankruptcy Court, of the debtor from all of his dischargeable debts, whether then payable or not. A permanent injunction against any collection action for pre–filing dischargeable debts. The goal a debtor seeks when filing for bankruptcy protection.
Chapter 7 Bankruptcy
The chapter of the Bankruptcy Code that provides for court-administered liquidation of the assets of a financially troubled individual or business.
Chapter 11 Bankruptcy
The chapter of the Bankruptcy Code that is usually used for the reorganization of a financially troubled business. Used as an alternative to liquidation under Chapter 7.
Chapter 13 Bankruptcy
The chapter of the Bankruptcy Code in which debtors repay debts according to a plan accepted by the debtor, the creditors, and the court.
A credit card that requires full payment of the bill each month; no interest is charged. The American Express Card is an example.
A loan or credit card debt written off as uncollectible from the borrower. The debt, however, remains valid and subject to collection.
ChexSystems is a check verification service and consumer credit reporting agency. It provides information about the use of deposit accounts by consumers.
When a borrower falls behind, the lender contacts them in an effort to bring the loan current. The loan goes to “collection.”
A “consumer” is defined as an individual.
A “consumer report” is any written, oral, or other communication of any information by a Consumer reporting agency that bears on a consumer’s creditworthiness, credit standing, Credit capacity, character, general reputation, personal characteristics, or mode of living which is used or expected to be used or collected, in whole or in part, for the purpose of Serving as a factor in establishing the consumer’s eligibility for:
1. Credit or insurance to be used primarily for personal, family, or household purposes
2. Employment purposes; or any other purpose authorized under section 604 (15 U.S.C. § 1681b).
Consumer Reporting Agency (CRA)
An agency that is a clearinghouse for information on the credit payment history of individuals or firms. There are three major credit bureaus, Equifax, Experian and TransUnion, and they are regulated by the federal Fair Credit Reporting Act (FCRA).
Consumer Financial Protection Bureau
The Consumer Financial Protection Bureau (CFPB) is an agency of the United States government responsible for consumer protection in the financial sector. CFPB jurisdiction includes banks, credit unions, securities firms, payday lenders, mortgage-servicing operations, foreclosure relief services, debt collectors and other financial companies operating in the United States.
A trust or promise to buy now and pay later under designated terms for goods or services.
A card that allows a consumer to pay a portion or all of the outstanding amount each month and has a credit limit. Visa, MasterCard, and Discover are examples.
An inquiry to confirm a consumer’s credit payment history.
A case when someone has stolen a consumer’s identity by fraudulently using that consumer’s social security number or other personal information to acquire credit in his or her name.
To request an investigation of the accuracy of information on a credit report.
The collection of information each of the credit reporting agencies maintains in their databases.
The record of a consumer’s credit accounts and manner of payment (MOP). Credit history includes high credit, current balance, credit limit, and 24 months or more of MOP history.
Credit inquiries are a notation listed on your credit report that a lender has checked your credit file. “Hard” inquiries can impact your Credit Score, while “soft” ones don’t. Creditors see only your “Hard” inquiries.
The maximum amount you are allowed to borrow from a lender under the terms of your agreement for an account.
Credit Monitoring Service
Services that monitor activity in your credit file and alert you to key changes in your file.
Credit repair is a general term used to describe the practice of improving or rehabilitating one’s financial reputation (creditworthiness) with creditors.
A record of the information in your financial credit file that is used by a lender, employer, or others to help evaluate you when you apply for a loan, job or in certain other circumstances.
An assessment of a consumer’s likelihood of fulfilling the terms of a credit agreement.
A credit score is a numerical index which represents an estimate of an individual’s financial creditworthiness. It is based on a subset of the information in an individual’s credit report.
Person or business to whom a debt is owed.
An assessment of a consumer’s past credit behavior that allows a potential lender to decide whether or not to extend credit. Credit reporting agencies are private, for-profit companies that collect and sell information about a person’s credit history. Typical clients include banks, mortgage lenders and credit card companies that use the information to screen applicants for loans and credit cards.
(a) the unpaid balance for each account;
(b) the Account balance, which does not include any finance or late charges assessed after Charge–off Date.
Date of Last Activity (DOLA)
The date when when one of three things happens on any active account: the consumer makes a payment, misses a payment, or the balance of the account increases
Debt consolidation entails taking out one loan to pay off many others. This is often done to secure a lower interest rate, secure a fixed interest rate or for the convenience of servicing only one loan.
A process to reduce or pay off old debt by negotiating a lower amount due with the creditor.
Your income compared to the debt you owe.
Failure to fulfill an agreed-upon financial obligation, such as making a loan payment.
Past-due payment on a loan.
If you have reviewed your credit report and found some data to be inaccurate, you can contact the companies involved to have it investigated and/or removed. This is considered a dispute.
Fair and Accurate Credit Transactions Act (FACTA)
A federal law that amended the federal Fair Credit Reporting Act in many areas. The law provided, among other things, additional protections for consumers in connection with the prevention and remediation of identity theft and the accuracy of credit reports. It includes your right to a free copy of your credit report from each of the three major credit reporting agencies every 12 months, which must be requested through the centralized source established under the FACT Act.
Fair Credit Billing Act (FCBA)
This Act, amending the Truth in Lending Act, requires prompt written acknowledgment of consumer billing complaints and investigation of billing errors by creditors. The amendment prohibits creditors from taking actions that adversely affect the consumer’s credit standing until an investigation is completed, and affords other protection during disputes. The amendment also requires that creditors promptly post payments to the consumer’s account, and either refund overpayments or credit them to the consumer’s account.
Fair Credit Reporting Act (FCRA)
Fair Credit Reporting Act (effective April 25, 1971) is part of a group of acts in the Federal Consumer Credit Protection Act. The Act protects information collected by consumer reporting agencies such as credit bureaus, medical information companies and tenant screening services. Information in a consumer report cannot be provided to anyone who does not have a purpose specified in the Act. Companies that provide information to consumer reporting agencies also have specific legal obligations, including the duty to investigate disputed information. Also, users of the information for credit, insurance, or employment purposes must notify the consumer when an adverse action is taken on the basis of such reports. Further, users must identify the company that provided the report, so that the accuracy and completeness of the report may be verified or contested by the consumer.
Fair Debt Collection Practices Act (FDCPA)
Under this Act (Title VIII of the Consumer Credit Protection Act), third-party debt collectors are prohibited from employing deceptive or abusive conduct in the collection of consumer debts incurred for personal, family, or household purposes. Such collectors may not, for example, contact debtors at odd hours, subject them to repeated telephone calls, threaten legal action that is not actually contemplated, or reveal to other persons the existence of debts.
Federal Trade Commission (FTC)
A federal agency whose duty is to investigate unfair methods of competition in business, fraudulent advertising, etc., and to restrain or prosecute those charged with such practices. The Commission’s primary purpose is to protect consumers.
A FICO score is a credit score produced from models developed by Fair Isaac Corporation. The score is used to measure a consumer’s creditworthiness and risk, and is in use worldwide. FICO scores range from 300 - 850 and are available through all of the major consumer reporting agencies in the United States: Equifax, Experian, and TransUnion.
The legal process by which a lender, usually a bank or other financial institution, acquires real property because the borrower failed to pay the mortgage.
Also known as a security freeze, you restrict access to your credit report, which in turn makes it more difficult for creditors to see your credit report.
Any company that submits information about you to be included on your credit report.
A legal process whereby a lender who has obtained a judgment on a debt can receive full or partial payment by seizure of a portion of the debtor’s assets (wages, bank account, etc.).
HIPAA is the acronym for the Health Insurance Portability and Accountability Act that was passed by Congress in 1996. HIPAA Mandates industry-wide standards for health care information on electronic billing and other processes; and requires the protection and confidential handling of protected health information.
Identity Theft / Identity Fraud
A crime that involves using another’s name, Social Security Number or other personal information to acquire credit, make purchases or commit a crime in that name.
An examination of a consumer’s credit history. When your credit report is made available to another party, such as a lender, landlord or insurer.
A credit account in which the amount of the payment and the number of payments are predetermined or fixed.
The cost of borrowing or lending money, usually a percentage of the amount borrowed or loaned.
A percentage of money charged by a lender, for borrowing money. For example, you might get charged 12.5% interest on any credit card balance carried over, or you might qualify for a 4.5% car loan.
A final court ruling resolving the key questions in a lawsuit and determining the rights and obligations of the opposing parties.
A fee attached to a delinquent account.
A delinquent payment; a failure to deliver a loan or debt payment on or before the time agreed. Late payments are reported to the credit bureaus by creditors, and appear as negative items on your credit reports.
LexisNexis (which acquired ChoicePoint) is the largest data-broker in the world and reseller of credit information. As of 2006, the company has the world’s largest electronic database for legal and public-records related information.
A legal claim upon real estate or personal property for the satisfaction of a debt. Liens you agree to are called security interests, and include mortgages, home equity loans, car loans and personal loans for which you pledge property to guarantee repayment. Liens created without your consent are called non consensual liens, and include judgment liens (liens filed by a creditor who has sued you and obtained a judgment), tax liens and mechanic’s liens (liens filed by a contractor who worked on your house but wasn’t paid).
Line of Credit.
Credit limit established by a creditor.
An account that is active or still being paid.
Paid as agreed
A designation on the credit report that indicates the consumer is repaying the credit account according to the terms of the credit agreement.
Information obtained from court records about such things as state or federal tax liens, bankruptcy filings and judgments against you in civil actions. Public records are open to any person who requests them.
An account that is brought to a current status, even though the total past due amount has not been paid. Some unscrupulous companies may do this in order to start the Date of Last Activity over again, in an effort to reset the typical 7 year clock for a negative item to automatically fall off of your credit report.
The action taken (usually by a financial institution) to recover an object that was used as collateral, rented or leased in a transaction.
The total balance of all revolving credit accounts.
Revolving Charge Account
Credit automatically available up to a predetermined limit so long as a consumer makes regular payments.
An account that requires at least a specified minimum payment each month plus a service charge on the balance, which can fluctuate up to the credit limit. As the balance declines, the amount of the service charge, or interest, also declines.
Secured Credit Card
A credit card secured by a savings account.
Settled In Full
The Debtor has satisfied the Account obligation with full payment of the amount due.
(a) payment of the adjustment amount of an account, including principal, interest and fees; or (b) a copy of a written settlement agreement or other written documentation evidencing a settlement.
Small Claims Court
Small claims court is a special court where disputes are resolved quickly and inexpensively. In small claims court, the rules are simplified and the hearing is informal. Attorneys are generally not allowed. The person who files the claim is called the plaintiff.
A charge upon real or personal property for the satisfaction of debts related to taxes.
The amount of time in which a loan must be repaid in full.
First announced in March 2006, VantageScore® is the latest addition in consumer credit scoring models. Its methodologies and algorithms were cooperatively developed by the three major consumer reporting agencies: Equifax, Experian, and TransUnion. VantageScores range from 501 - 900.