| Affinity Card | A credit card that donates to a charity/football club etc when you spend money. A good deal for the charity, but usually a bad deal for the customer. |
| APR | Annual Percentage Rate. Shows the overall cost of a loan, taking into account the term, interest rate and other costs. |
| Authorised Overdraft | When your bank account has a negative balance, with the bank's permission. Terms are usually favourable compared to an unauthorised overdraft. |
| Balance Transfer | When you transfer an outstanding balance from one credit card to another, perhaps to benefit from a lower rate. |
| Booking Fee | A fee charged by many mortgage lenders when you apply for a mortgage. Common, as it helps them make their interest rate look more attractive. |
| Bridging Loan | A bank loan enabling you to buy a property before selling your existing home. |
| Buffer | An agreed amount above your authorised overdraft into which you can slip without the usual penalties applying. |
| Cap | The maximum interest rate above which your mortgage cannot go. |
| Card Issuer | The bank, building society or store whose name is on your card. |
| Cashback Card | Credit cards that give you a percentage of the money you spend (e.g. 1%) as a cashback. |
| Chip & Pin | Credit card security system that replaced signatures. Combines a small electronic chip built into the credit card with a four digit number entry at the point of purchase. |
| Collar | The minimum interest rate below which your mortgage cannot go. |
| Credit Limit | The maximum amount you may owe through spending on the card. Exceeding this could incur charges and the card being suspended. |
| Credit Scoring | A method lenders use to assess how likely a person is to repay the money they wish to borrow. |
| Discounted Mortgage | A mortgage that offers a discount on the lender's SVR or a tracker rate, usually for up to three years. |
| Fixed Rate Mortgage | A mortgage whose interest rate is fixed for a period of time, usually up to five years. |
| Flat Interest | An interest rate that is charged on the original sum borrowed throughout the term. To get a rough estimate of the APR, double the figure. |
| GAP Insurance | Guaranteed asset protection insurance is designed to make up any shortfall between what's owed on hire purchase and a car insurer's payout if your car is written off or stolen. |
| Hire Purchase | Similar to a loan, except the goods purchased do not belong to you until the loan is fully repaid. |
| In Arrears | Describes a debt when you've failed to keep up the monthly repayments. |
| Interest Only Mortgage | A mortgage where your monthly payments are used to pay interest only. The amount borrowed will still be outstanding at the end of the mortgage term. |
| Interest-Free Period | The time between when you buy something on the card and the date when you must pay your monthly bill. Can be up to 56 days. |
| Lease Purchase | Another name for hire purchase, usually applied to car policies. |
| Minimum Payment | The minimum amount you must pay each month to avoid charges in addition to interest. |
| Mortgage | A type of loan used to purchase a property. It will normally run for 20 - 25 years and be secured against the property being purchased. |
| Mortgage Indemnity Guarantee | An insurance designed to protect mortgage lenders if they repossess your home and are left out of pocket when the property is then sold. |
| Negative Equity | The difference between your home's value and your mortgage when the home is worth less than the mortgage. |
| Offset Mortgage | A mortgage that is linked to a bank account, with any savings offsetting the balance owed, hence interest payable, on the mortgage. |
| Overdraft | A temporary loan that kicks in should the balance on your bank account fall below zero. |
| PCPs | Personal contract plans, a type of hire purchase where you must pay a large final payment to keep the goods (e.g. car) else hand it back to the finance company. |
| Redemption Penalty | A charge applied by some mortgage lenders if you want to repay your mortgage early. |
| Re-Mortgaging | Switching from your current mortgage to another. |
| Repayment Mortgage | A mortgage where your monthly payments are used to pay interest and repay the outstanding balance. |
| Rewards Card | Credit cards that give you some sort of reward (e.g. air miles) when you spend money. |
| Secured Loan | A loan where you have to offer the lender security (e.g. your home) in case you can't keep up payments. |
| Student Loan | A government loan for qualifying students, offers a subsidised rate of interest linked to the rate of inflation (RPI). |
| SVR | Standard variable rate. A mortgage lender's plain vanilla mortgage rate, usually a few percent above the Bank of England Base Rate. |
| Tracker Mortgage | A mortgage whose interest rate is variable and follows the Bank of England Base Rate exactly, usually by a fixed amount above or below. |
| Unauthorised Overdraft | When your bank account has a negative balance, without the bank's permission. This can result in stiff charges and high interest. |
| Unsecured Loan | A loan where you don't have to offer the lender security (e.g. your home) in case you can't keep up payments. |
| Valuation Fee | Most mortgage lenders charge you to carry out a valuation, making sure the house is worth at least what they're lending you. |