Credit Card Glossary - S

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Savings and Loan Association

A state or federally-chartered depository financial institution that was primarily a provider of home mortgages but since deregulation in the 1980s to offer services similar to a commercial bank.

Savings Bank

A type of depository financial institution, found mostly in the northeastern United States, that accepts consumer deposits and invests these funds primarily in residential mortgages and high-grade securities. Mutual savings banks are owned by their depositors, while stock savings banks issue common stock to the public.

Secured Credit Card

Credit card used by people trying to rebuild their poor credit or by beginners establishing their credit. The cardholder's savings deposit or bank account guarantees payment of the outstanding balance if he defaults on payments. Credit line will represent 50-100% of the security deposit. Many have application and processing fees.

Secured Debt

A debt that is secured by a lien on debtor's property that may be taken by the creditor in case of nonpayment by the debtor. A common example is a mortgage loan.

Secured Loan

Borrowed money that is backed by collateral.

Security

Property designated as collateral.

Service Charge

Fees charged to customers for specific services or as a penalty for not meeting certain requirements such as insufficient funds in a checking account.

Simple Interest

Interest computed only on the principal balance, without compounding.

Simple Interest loan

Modification of an existing loan after the borrower has been delinquent. Often used when the borrower misses payments but the lender does not foreclose.

Smart Cards

A card that has a pre-determined limit of cash, which is then drawn off with every purchase. The card stores information on a microprocessor or memory chip rather than the magnetic stripe found on ATM and credit cards.

Standard Card

The basic card offered by credit card companies.

Standard Payment Calculation

A method of figuring out how much monthly payments should be, based on the beginning loan balance, the term and the interest rate.

Statement

A detailed record of transactions in a bank customer?s account(s) for a certain period, usually each month, which shows debits, credits, transfers, payroll deposits, account balance, check fees, service charges, ATM activity, etc..

Subprime Borrower

A borrower with a less-than-perfect credit report due to late payments or a default on debt payments. Lenders often grade them based on the severity of past credit problems, with categories ranging from "A-" on down to "D" or lower.