Credit Card Glossary - F

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F (Fixed)

If the letter "F" follows the annual percentage rate (APR), the rate is fixed and not adjustable.

Fair Credit Billing Act

Federal Trade Commission Act to help customers resolve billing disputes with card issuers and limit consumer liability for unauthorized credit card use. The act was written to promote accuracy and ensure the privacy of information used in consumer reports. You have the right to know everything that is in your report. The Credit Reporting Agency must also give you a list of everyone who has requested your report in the past year, the past 2 years if it was for employment inquiry.

Fair Credit Reporting Act

Federal Trade Commission Act holds credit reporting agencies responsible for correcting inaccurate information in credit reporting. Entities that give information to the Credit Reporting Agencies are required by the FCRA to provide accurate information. Also limits disclosure of consumer credit reports only to entities with specified purpose.

Fair Debt Collection Practices Act

A federal law that prohibits certain methods of debt collection, such as harassment.

FDIC

Federal Deposit Insurance Corp. An agency of the U.S. government that manages the bank insurance funds, which insure deposits at banks and other qualifying financial institutions up to $100,000 per account in interest and principal. FDIC insurance is mandatory for all nationally chartered banks and all banks that are members of the Federal Reserve System.

Fed

Congress founded the Federal Reserve, the central bank of the United States, in 1913. It conducts the nation's monetary policy and regulates its banks in order to achieve a flexible and stable economy. The seven members of the Board of Governors of the Federal Reserve System are nominated by the President and confirmed by the Senate to serve 14-year terms. The chairman and the vice chairman of the board are named by the President from among the members and are confirmed by the Senate. They serve a term of four years.

Federal Advisory Council

An advisory group consisting of one member elected from each of the 12 Federal Reserve Districts who meet with the Federal Reserve Board of Governors at least four times each year to make recommendations on business and financial matters.

Federal Deposit Insurance Corporation

An agency of the U.S. government that manages the bank insurance funds, which insure deposits at banks and other, qualifying financial institutions up to $100,000 per account in interest and principal. FDIC insurance is mandatory for all nationally chartered banks and all banks that are members of the Federal Reserve System.

Federal Discount Rate

The interest rate at which an eligible financial institution may borrow funds directly from a Federal Reserve bank. Banks whose reserves dip below the reserve requirement set by the Federal Reserve's board of governors use that money to correct their shortage. The board of directors of each reserve bank sets the discount rate every 14 days. It's considered the last resort for banks, which usually borrow from each other.

Federal funds rate

The interest rate at which banks and other depository institutions lend money to each other, usually on an overnight basis. The law requires banks to keep a certain percentage of their customer's money on reserve, where the banks earn no interest on it. Consequently, banks try to stay as close to the reserve limit as possible without going under it, lending money back and forth to maintain the proper level.

Federal Open Market Committee

This 12-member committee meets eight times a year to set guidelines for the Federal Reserve regarding the sale and purchase of government securities in the open market. Its chief importance for consumers is that the FOMC can adjust the federal funds rate and the federal discount rate. Banks set their rates based on the FOMC's moves, and therefore the committee's actions effectively ratchet consumer interest rates upward or downward. The committee is comprised of the seven members of the Board of Governors; the president of the Federal Reserve Bank of New York, and four of the presidents of the other 11 reserve banks.

Federal Reserve Board

Congress founded the Federal Reserve, the central bank of the United States, in 1913. It conducts the nation's monetary policy and regulates its banks in order to achieve a flexible and stable economy. The seven members of the Board of Governors of the Federal Reserve System are nominated by the President and confirmed by the Senate to serve 14-year terms. The chairman of the Board of Governors is Alan Greenspan. The chairman and the vice chairman of the board are named by the president from among the members and are confirmed by the Senate. They serve a term of four years.

Federal Reserve Board of Governors

The seven-member governing board of the Federal Reserve System. Members are appointed by the president and confirmed by the Senate for their 14-year terms. The board supervises the activities of the Fed and, as the majority of the Federal Open Market Committee (FOMC), is principally responsible for the conduct of monetary policy.

Federal Reserve Board of Governors

The central banking system for the United States, known as the "Fed," was established by the Federal Reserve Act of 1913 and serves as the nation's central bank, issuing the nation's currency, conducting monetary policy through the regulation of the money supply and the cost of credit, facilitating the clearing of checks, providing short-term credit to member banks through the discount rate, regulating bank operations, approving interstate bank mergers, supervising bank holding companies, and providing oversight to international banking operations. It includes a seven-member Federal Reserve Board of Governors, 12 Federal Reserve Districts each with a Federal Reserve Bank (and 24 branch offices), the decision-making Federal Open Market Committee (FOMC), and the Federal Advisory Council consisting of an elected member from each Federal Reserve District that makes recommendations to the Board of Governors on business and financial matters.

Federal Reserve System

The seven-member governing board of the Federal Reserve System. Members are appointed by the president and confirmed by the Senate for their 14-year terms. The board supervises the activities of the Fed and, as the majority of the Federal Open Market Committee (FOMC), is principally responsible for the conduct of monetary policy.

Federal Savings and Loan Insurance Corporation

A federal institution that insures deposits of federally chartered savings and loan associations.

Federal Trade Commission

A federal agency that enforces antitrust and consumer protection laws, including the Truth-in-Lending Act, Fair Credit Billing Act, Fair Credit Reporting Act, Equal Credit Opportunity Act, Fair Debt Collection Practices Act and Home Ownership and Equity Protection Act.

FICO scores

The software used to calculate a great number of credit scores was created by Fair Isaac Corporation--FICO.

Fiduciary

An individual, company or association responsible for managing someone else's assets. Fiduciaries include executors of wills and estates, trustees, receivers in bankruptcy and those responsible for managing the finances of a minor.

Finance Charge

The charge for using a credit card, including interest rates and other fees.

Float

The amount of time the bank takes to clear -- or reject (bounce) -- a check for payment; the time at which funds are debited from the issuer?s account.

Floor

The minimum rate possible on a variable-rate loan or line of credit, after any initial introductory rate period. For example, on a credit card with the Prime rate as its index, no matter how low the Prime rate drops, the rate on the line may never decrease below the stated rate floor.

Foreign Currency Surcharge

Charge by some credit card dealers that adds an additional charge for purchases made in a foreign currency.

Free Period

Also called "grace period." An interest-free period of time a lender gives between the transaction date and billing date, if there is no balance carried over from the previous billing cycle. Generally, the free period is between 20-30 days. If your card includes a free period, the issuer must mail your bill at least 14 days before the due date so you have enough time to pay. People who carry a balance on their cards do not receive a grace period and finance charges begin the date a purchase is made with a credit card.

Fresh Start

The characterization of a debtor's status after bankruptcy. i.e., free of most debts. (Giving debtors a fresh start is one purpose of the Bankruptcy Code.)