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Annual fee -- A bank charge for use of a credit card assessed 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. Authorized user -- Any person to whom you give permission to use a credit card account. Average daily balance -- This is the method by which most credit cards calculate your payment due. An average daily balance is determined by adding each day's balance and then dividing that total by the number of days in a billing cycle. Annual percentage rate (APR) -- A yearly rate of interest that includes fees and costs paid to acquire the loan. Lenders are required by law to disclose the APR. The rate is calculated in a standard way, taking the average compound interest rate over the term of the loan, so borrowers can compare loans. Additional principal payment -- Extra money included with a loan payment to pay off the amount owed faster. Over time, this practice reduces the amount of interest paid. Billing cycle -- The number of days between the last statement date and the current statement date. Billing statement -- The monthly bill sent by a credit card issuer to the customer. It gives a summary of activity on an account, including balance, purchases, payments, credits and finance charges. Important changes to a credit card account are often included in small-print fliers that are sent with the statement. Charge-off -- This is primarily an accounting term when a creditor eliminates a balance due on an account from the creditors assets. This is referred to as a "non-performing asset also knows as a "write-off" This debt is considered an uncollectable debt and will reflect on a credit report as a "bad debt" or "charge –off". When an account is charged off, the creditor will generally demand the balance in full or agree to a settlement paid within 30 days. Charge-offs are generally reported to the credit bureaus as an I9 or R9. The number 9 is the code for a charged off account. Consumer bankruptcy -- A bankruptcy case filed to reduce or eliminate debts that are primarily consumer debts. Co-signer -- A person who signs a promissory note that is also signed by one or more other parties. All parties take responsibility for the debt if any of the others renege. Consumer Credit Counseling Service -- A service that offers counseling about how to work out a realistic budget and debt repayment plan and work with creditors. The goal is to ensure that debts are paid back over time. Consumer credit -- Loans for personal or household use as opposed to business or commercial lending. Loans are generally unsecured, not backed by collateral. Consumer debts -- Debts incurred for personal, as opposed to business, needs. Credit -- Money that a lender gives to a borrower on condition of repayment over a certain period. Credit bureau -- A company that collects and sells information about how people handle credit. It issues credit reports that list how individuals manage their debts and make payments, how much untapped credit they have available and whether they have applied for any loans.

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