Affinity Credit Card:
A credit card which is sponsored by two or more organizations. For example, the Shell Citibank MasterCard and the Citibank Cathay Pacific Visa, which are sponsored by Citibank and partners Pilipinas Shell and Cathay Pacific, respectively.

Age Requirement:
To qualify for a credit card, you must be at least 21 years old if you are the principal cardholder, or 16 if you are applying for a supplementary card.

Annual Fee:
Credit card companies charge an annual fee; it is the yearly cost you pay to use the card.

Annual Percentage Rate:
The annual percentage rate is a measure of the cost of credit expressed as a yearly rate. When you open a credit card account, you agree to pay a percentage of the outstanding balance each month as a finance charge.

A form used to apply for credit.

Cash or anything you own that can be turned into cash. This includes property, goods, savings or investments.

Automated Teller Machine.

Available Credit:
Available credit is your credit limit minus your current balance. It is the unused portion of your credit line.

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Bad Credit:
A term used to describe a poor credit rating. Common practices which can damage your credit rating include late or missed payments, exceeding the limit on cards, defaulting on loans or declaring bankruptcy. "Bad Credit" can result in the denial of future credit.

Balance/Amount Owed:
The total amount you owe the issuer including any unpaid balance from last month, new purchases, cash advances, and any other charges such as an annual fee, late fees or finance charges. The "Total Amount Due" should not be confused with the minimum amount due (the minimum payment allowed each month).

Balance Calculation Method:
Balance Calculation Method is the method used by a credit card issuer to calculate the balance owed and the interest due each month.

Balance Transfer:
Transferring balances from one credit card to another, usually to take advantage of a lower interest rate. Transfers are limited to the available credit on the receiving card.

Billing Cycle:

The number of days between your last statement date and your current statement date.

Billing Statement:
A monthly bill from your credit card issuer which describes and summarizes the activity on your account including the outstanding balance, purchases, payments, credits, finance charges and other transactions for the month.

The borrower is the person who signs and agrees to the terms of a promissory note and is responsible for repaying the loan.

Bottom Line:
The bottom line is your monthly income less expenses.

The financial record you use to keep track of the money you earn, how much you spend and what you spend it on. Your budget also includes savings and how much you pay to your creditors.

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Cardmember Agreement:
The issuer's written statement of terms and conditions relating to your credit card account. The Agreement states the annual percentage rate, the monthly minimum payment formula, annual fee, if applicable, and your rights in billing disputes.

Cash Advance:
A cash withdrawal at an automated teller machine, or with a bank teller or by use of a convenience check. This cash is an instant availment of your credit card account. The credit card company will apply finance charges from the day you take the advance until the day you pay it off. A one-time service/transaction fee is also charged based on the amount of your withdrawal.

Cash Advance Fee:
A one-time fee for cash advances in addition to normal finance charges. This fee is usually a percentage of the advance amount.

Charge Card:
A card that requires full payment of the balance before the end of the billing period. It is not a line of credit and no interest is charged.

An asset pledged to a lender to guarantee repayment. Collateral could include savings, bonds, insurance policies, jewelry, property or other items that are pledged to pay off a loan if payments are not made according to the contract. Collateral is not required for unsecured credit card accounts.

The referral of a past due account to a specialist in collecting loans or accounts receivable.

Consolidation Loan:
If you owe money to several creditors, you can combine your payments and balances into a single account with one creditor. This can be done in several ways. For example, if you own a home, you can consolidate your debt with a low-interest home equity loan. Or, you can get a loan specifically designed for this purpose.

To sign a credit agreement with someone and agree to share the debt with that person or assume the debt if the other person defaults and doesn't pay.

A co-signer is a person who signs a loan or credit card with the primary applicant, pledging to be responsible for repaying the loan, debt or credit card in the event the applicant is unable.

An amount of money that a bank lends or credit card issuer extends to you. You can charge/spend any amount from your credit line to make purchases or take cash advances. As long as you pay the minimum amount due each month by the due date, you can continue to use your remaining available credit.

Credit Card Dues:
The total unpaid balances on all of your credit cards (not to be confused with the minimum amount you owe each month).

Credit Criteria:
Factors used by lenders to rate credit worthiness or ability to repay debt. They may include the following: income, amount of personal debt carried, number of accounts from other credit sources and credit history. A lender is free to use any credit-related information in approving or denying a credit application .

Credit History:
Your credit history is a record of the way you manage your debt. When you apply for new credit or a loan, the bank will check your credit history before granting any credit.

Credit Limit:
The maximum balance you can carry on your account.

Credit Management:
The way you handle the money you borrow from banks or avail from credit issuers. For example, you should try to pay more than the minimum due each month and make sure payments are received by the due date.

You are judged to be qualified to have credit.

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Daily Periodic Rate:

The interest rate factor used to calculate the interest charges on a daily basis. The factor is computed by dividing the yearly rate by 365 days.

Debit Card:
When you make a purchase with a debit card, money is deducted directly from your bank account. You can spend only the amount of money you have in your bank deposit account when you use your debit card.

Money you owe to banks or credit issuers. More specifically, it is the amount of money that you have borrowed and not paid back or money that you availed versus your credit line and not paid back.

Debt Ratio/Debt Burden:
Debt ratio is a way of figuring out how much you owe compared to how much you make. It is the percentage of your income that goes to paying your debts every month. Debt ratio usually gives a clear picture of your overall financial well-being. To calculate your debt ratio, first add up all your monthly income including take-home pay (after taxes), Social Security or disability benefits, among others. Then add up all your monthly payments for interest-bearing loans and accounts, such as mortgages, credit cards, and car loans. If you rent your home, include that amount, but do not include utilities and telephone charges, because they can vary on a monthly basis. Finally, divide your monthly payments by your income. Multiply the result by 100 and that number is your debt ratio percentage.
  • A low ratio is under 20%, which means that you are in good financial health and are doing a good job of managing your money.
  • A moderate ratio is between 21% and 40%. This means that you should look carefully at your monthly payments and start decreasing your overall level of debt, including credit cards.
  • A high debt burden is over 40%. You should immediately stop accumulating debt and start looking for ways to decrease your debt or increase your income.

Failure to repay a loan or credit card according to the agreed upon terms.

Deferred Payment:
Payments put off to a future date or extended over a period of time. Interest will usually still accumulate during deferment.

Delinquency Assessment/Late Fee:
A fee that is charged for a late payment.

When loan payments or credit card dues are not paid according to the terms of the promissory note/agreement. Late fees are often assessed on delinquent accounts, and delinquency results in default.

Disclosure Statement:
A disclosure statement details the actual cost of a loan, including all estimated interest costs and loan fees. For credit card accounts, this information may be found in the Cardmember Agreement or credit card application form.

If you think your bill is wrong, write to your credit card issuer at the address listed on your statement. You must write no later than 20 days from the statement date where the error appeared. The credit card issuer must acknowledge your letter within 10 days, and correct the error or explain why they think the statement was correct within two billing cycles, but no later than 90 days after its receipt of your letter. You do not have to pay the amount in question while it is investigated, but you must pay the rest of your bill.

Due Date:
The day a payment is due to a creditor. After that date, a late fee can be charged, the payment can be recorded as late, and the account can be considered delinquent.

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Finance Charges:

Finance charges are the cost of consumer credit expressed as a peso amount. They include any charges, such as interest and fees, paid by the consumer to the creditor for obtaining a loan or using a credit card.

Financial Health (also referred to as financial well being):
This is a description of your overall financial situation. To take a closer look at your financial health, you consider the amount of money you make each month, if you own a home or other valuables, any investments you may have, and the amount of debt you carry. For example, if you own a home, have a small mortgage, and have very little credit card debt, you are in good financial health.

Fixed Expenses:
Fixed expenses are those that you have to pay every month. These are expenses that you really can't change like your mortgage, rentals or car payment.

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Grace Period:
If you do not have an outstanding revolving balance on your credit card, a grace period is the period of time you have to pay new balances before interest charges apply.

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Household Income:
Income from all sources including wages, commissions, bonuses, alimony, child support, Social Security/retirement benefits, disability, dividends and interest.

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Installment Loan:
A loan that you promise to pay back by paying the same amount of money on a regular basis, usually monthly, for a specific amount of time. Home equity loans and auto loans are usually installment loans.

Interest Rate:
The rate that a bank or credit issuer charges for the money it lends to you.

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Late Payment:
Most charge and credit card bills list the date by which payments are due. If you miss the due date, the account is considered past due and you may be charged a late fee. Late payments may be reflected on your credit report. If you have paid late numerous times, it may be difficult to get additional credit.

Late Payment Fee:
A fee charged for failing to submit at least the minimum monthly payment by its due date.

Liability is the responsibility for a loan or credit account. When applying for credit, a Cardmember agrees to be liable for any charges to his or her account, including purchases, fees and finance charges. Your liability is described in the Cardmember Agreement you receive from the issuer.

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Minimum Amount Due/Minimum Payment:
The smallest amount you can pay by the due date and still meet the terms of your Cardmember Agreement. With Citibank credit cards, this represents 5% of your total amount due or P200, whichever is higher.

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Non-taxable Income:
Money you earn that is not taxed by the government. This money can come from several sources including disability pay or legal settlements due to personal injury.

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Outstanding Balance:
The total amount that you owe on a credit card or other loan.

Over the Credit Limit:
When the amount you owe is more than the limit on your credit line. Any combination of purchases, cash advances, fees or finance charges may cause you to exceed your credit limit. For example, you will be over the credit limit if you spend P15,000 when you have P10,000 of your credit line left. If you go over your credit limit, your credit card purchase might be denied.


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Past Due:
The status of an account when the minimum payment has not been received by the due date.

Periodic Rate:
The interest rate described in relation to a specific amount of time. For example, the monthly periodic rate is the cost of credit per month; the daily periodic rate is the cost of credit per day.

Abbreviation for Personal Identification Number, the number used as an access code to ATMs or debit machines.

Posting Date:
The date that a purchase, cash advance, fee, service charge or payment is recorded on your charge or credit account.

Pre-Approved Credit:
Credit card or a line of credit that is approved based upon available data without further information supplied by the potential Cardmember.

When a portion or the entire amount of the principal of a loan is paid before it is due. This will usually reduce the total amount of interest that must be paid.

Previous Balance:
The total balance due at the end of the last billing cycle.

Prime Rate:
The Prime Rate is the interest rate that major banks charge to many of their best corporate borrowers. Each bank sets it own Prime Rate, though because the rate is so competitive, most of the time the rate is the same at all banks.

For consumer loans and credit cards, banks and other lenders often use the Prime Rate as a base for calculating variable interest rates.

Principal is the portion of a loan that represents the actual amount of money borrowed. Principal is separate from interest. In terms of credit cards, principal represents the price of straight purchased items or the amount of a cash advance.

Promissory Note:
A promissory note is a binding legal document that a borrower signs to obtain a loan. It lists your rights and responsibilities under the loan agreement, including how and when the loan must be repaid. Rights and responsibilities for credit card accounts are listed in the Cardmember Agreement.

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Quarterly divides the year into four parts. In a calendar year, the first quarter is January through March, second quarter is April through June, third quarter is July through September, and fourth quarter is October through December.

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Rebate Card:
A credit card that supplies benefits based upon the card's usage. Benefits are usually in the form of services, such as airline tickets, discounts on future purchases or cash refunds. The credits accumulated toward these benefits are often a percentage of each purchase.

A person who can vouch for your reliability, employment history or other factor needed to determine your creditworthiness.

Revolving Credit:
A credit agreement that allows consumers to pay all or part of the outstanding balance on a loan or credit card. As credit is paid off, it becomes available again to use for another purchase or cash advance.

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Secured Card:
A credit card that is guaranteed by a cash deposit held in a special savings account or certificate of deposit. The deposit must remain in the account until the credit line is closed or the issuer decides security is no longer necessary. The credit line on the card is usually equal to the amount of the deposit. If the Cardmember defaults on the card, the issuer will apply the deposit toward the outstanding balance.

Secured Debt:
Debt for which repayment is guaranteed through collateral-property of equal or greater value than the amount of the loan. If you do not repay the loan, the issuer may take possession of the collateral. Collateral may be an asset such as a car or a home or, in the case of a secured credit card, a cash deposit held by the issuer. For example, a mortgage is a secured debt in which the home is collateral. If the person fails to repay the loan, the bank may take the home as payment.

Signs of Trouble:
Situations or events that suggest you may be having financial difficulty. For example, using one credit card to pay the monthly minimum on another card, or routinely having 'maxed out' credit cards.

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Taxable Income:
Any money you earn or receive - such as salary, bonuses or interest from investments - that can be taxed by the government.

Transaction Date:
The date a purchase is made or cash is withdrawn. Some companies assess interest from the transaction date, others from the posting date.

Transaction Fee:
An extra charge for various credit activities such as using an ATM or receiving a cash advance.

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Unsecured Debt:
This is debt that is not guaranteed by collateral, therefore, no assets are committed in the event of default. If the issuer is unable to collect on the loan, its value is lost. Most credit cards are unsecured. As the Cardmember's promise is the only guarantee, credit card issuers require more information regarding income and credit history than with a secured loan.

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Variable Expenses:
Variable expenses are those that can change from month to month. Variable expenses include necessities that can be reduced (such as food and utilities) and non-essentials that could be eliminated (e.g., long distance charges, cable, magazine subscriptions, etc). Reducing these expenses is the simplest step in getting control of your finances.

Variable Interest Rate:
An interest rate that changes based on an economic index such as the Prime Rate.

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Zero Balance:
Zero balance is when the total outstanding balance is paid and there are no new charges or cash advances during a billing cycle.