Financial Services Glossary
A glossary helps make the rest of the folder easier to read by defining common financial terms in plain language.
- Amortization
- The longer repayment schedule over which a loan or mortgage is designed to be paid down.
- APR
- A broad annualized borrowing-cost expression used to help compare credit products, though the real practical cost still depends on how the product is used.
- Credit Utilization
- The share of available revolving credit that is currently being used.
- Deductible
- The portion of a covered loss that a policyholder generally absorbs before the insurer’s portion of a claim applies.
- Grace Period
- A limited period during which a payment, balance, or transaction may be treated differently before interest or penalties fully apply.
- Interest
- The cost of borrowing money, or the return paid on certain deposits or investments.
- Principal
- The original amount borrowed or the remaining core amount on which repayment and interest calculations are based.
- Term
- The specific period during which a product’s conditions remain in force.
- Underwriting
- The evaluation process used to assess risk and decide whether a product or coverage will be offered and on what terms.
Why a Glossary Helps
Financial language often makes products sound more complicated than they are, or more straightforward than they really are. A glossary will not replace careful reading, but it can reduce confusion and make comparisons across products and providers much easier.
← Back to Financial Guides
