Podcast
Questions and Answers
What is a 'current account' commonly known as in the USA?
What is a 'current account' commonly known as in the USA?
What does 'In the red' signify in banking terms?
What does 'In the red' signify in banking terms?
What is the function of a 'mortgage loan'?
What is the function of a 'mortgage loan'?
What happens when a borrower 'defaults on a loan'?
What happens when a borrower 'defaults on a loan'?
Signup and view all the answers
What is the main difference between a credit card and a debit card as described in the text?
What is the main difference between a credit card and a debit card as described in the text?
Signup and view all the answers
In the context of loans, what does it mean for interest to 'accrue'?
In the context of loans, what does it mean for interest to 'accrue'?
Signup and view all the answers
What is the difference between arrears and debt based on the text?
What is the difference between arrears and debt based on the text?
Signup and view all the answers
What is the process outlined in Step 8 of the text?
What is the process outlined in Step 8 of the text?
Signup and view all the answers
How is a fixed interest rate loan different from a variable interest rate loan?
How is a fixed interest rate loan different from a variable interest rate loan?
Signup and view all the answers
What should you do if you can't make payments on time, according to the text?
What should you do if you can't make payments on time, according to the text?
Signup and view all the answers
Study Notes
Banking Terminology
- In the USA, a 'current account' is commonly known as a 'checking account'.
Banking Status
- 'In the red' signifies that an account has a negative balance, meaning the account holder has overdraft.
Mortgage Loans
- A 'mortgage loan' is a loan used to purchase a property, with the property itself serving as collateral.
Loan Defaults
- When a borrower 'defaults on a loan', they fail to make scheduled payments, resulting in the lender taking action to recover the loan amount.
Credit and Debit Cards
- The main difference between a credit card and a debit card is that a credit card allows borrowing, while a debit card deducts funds directly from the account holder's balance.
Loan Interest
- When interest 'accrues', it means that the borrower is charged additional interest on the outstanding loan amount, increasing the total amount owed.
Arrears and Debt
- 'Arrears' refers to the unpaid amount of a loan, while 'debt' refers to the total amount owed, including interest and fees.
Loan Repayment
- Step 8 of the text outlines the process of contacting the lender to discuss alternatives if payments cannot be made on time.
Loan Interest Rates
- A fixed interest rate loan has a constant interest rate throughout the loan term, while a variable interest rate loan has an interest rate that may change over time.
Managing Loan Payments
- If you can't make payments on time, you should contact the lender to discuss alternative arrangements to avoid defaulting on the loan.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Test your knowledge of basic banking terms and account types with this quiz. Explore the definitions of current accounts, savings accounts, business accounts, and overdraft facilities.
