Understanding Credit Agreements

A legal agreement to receive cash, goods, or services now and pay for them in the future is called ______.

Individual Money Lenders lend their surplus to those in need so that it will bring income to them. They are a source of ______.

Retail Stores, Pawnshops, and Commercial Banks engage in the grant of loans not only to businessmen, but also to individuals for personal purposes. They are sources of ______.

Savings Banks are financial institutions whose primary purpose is accepting savings deposits and paying interest on those deposits. They are a source of ______.

Development banks are financial institutions dedicated to funding new and upcoming businesses and economic development projects by providing equity capital or loan. They are a source of ______.

Investment Banks are financial institutions that provide large amounts of long-term fixed capital, primarily to established firms. They generally take an equity stake in the borrower firm to exercise some influence on its direction and operations. They are a source of ______.

Credit Unions lend savings of ______ to some of the ______ of the group. They are corporate organizations.

Insurance Companies issue insurance contracts with those who wish to provide for ______ like death or fire. They receive premiums and pay out money on the occurrence of the particular ______.

The Five Cs of Credit include Capital, Condition, Capacity, Collateral, and __________.

Credit Terms are the terms and conditions under which credit is granted. Credit Periods refer to the amount of time within which the customer is expected to remit payment in part or in full. Credit Limit is a limit with respect to the amount or ______ that a customer can obtain from the source.

To establish credit, one can use bank accounts, employment history, residence history, utilities in borrower’s name, and department store or ______ credit card.

To maintain a good credit rating, it is important to establish a good credit history, pay monthly ______ on time, use credit cards sparingly and stay within the limit, not move ______ to other cards, and check credit report regularly.