Bankrate's financial glossary
Did you run across an unfamiliar term when applying for a mortgage, credit card
or auto loan? Find the meaning here, along with definitions of other financial words
and phrases, in Bankrate.com's financial glossary.
Adjustable-rate mortgage (ARM)
Home loan in which the interest rate is changed periodically based on a standard financial index. Most ARMs have caps on how much an interest rate may increase.
Adjusted cost basis
The amount paid for an item, plus the amount paid for improvements, minus losses and depreciation. When the owner sells the item, the difference between the sales price and the adjusted cost basis is the profit or loss.
Property lines that are drawn to settle a dispute between neighboring property owners.
Mathematical formula for calculating a borrower's monthly payments, based on the amount borrowed, the interest rate and the term of the loan.
A provision in a mortgage contract that allows a buyer to take responsibility for the loan from the seller.
A method used by some card issuers in which they subtract all payments made during the month, then add the finance charges.
A card offered by two organizations, one a lending institution, the other a non-financial group. Schools, nonprofit groups, pro wrestlers, popular singers and airlines are among those featured on affinity cards. Usually, use of the card entitles holders to special discounts or deals from the non-financial group.
One of the most popular rewards issued by airline-affiliated co-branded cards. Air miles are earned with every use of the card, and then transferred monthly to the cardholder's account with that airline.
A bank charge for use of a credit card levied each year, which can range from $15 to $300, billed directly to the customer''s monthly statement. Many credit cards come without an annual fee.