Definitions

ACH (or Automatic Clearing House) - The ACH is the method of fund transference between bank accounts. Consumers often know the ACH by the common name of Direct Deposit and often doesn’t cost anything to do. A Wire Transaction, on the other hand, costs up to $50 per transaction. ACF funds tend to be available the very next day.

APR (Annual Percentage Rate) – The is the cost of borrowing money, noted in a yearly rate. The APR is typically not the same as the interest rate noted in a contract.

Credit Bureau – This is the company that accumulates consumer financial data such as pay off schedules, balances and credit histories regarding loans and credit cards. Lenders will use the credit bureaus – Equifax, TransUnion and Experian – to decide on whether or not to extend credit. Personal loan lenders generally avoid these credit bureaus and go with providers such as Teletrac or DataX, which don’t appear in a person’s credit history.

Debt Collection – A lender can try collecting a debt a consumer has defaulted on, using various means such as a law firm. Consumers do have rights and should visit the following website to learn more about them – http://www.consumer.ftc.gov/articles/0149-debt-collection.

Debt Consolidation – A consumer who cannot meet their obligation to repay debt can use the debt consolidation strategy to negotiate with lenders to decrease the interest rate on the loan or to extend the loan’s terms in order to decrease the monthly payment.

Default – This is when a consumer fails to pay back a loan or meet the loan agreement’s terms. This can result in the lender taking Debt Collection action.

Direct Deposit – Similar to ACH, as it’s an electronic transfer of money to a bank account and discontinuing the need for paper checks.

Equal Credit Opportunity Act – This is a federal law that forbids lenders to discriminate against an applicant for credit approval.

E-Signature (Electronic Signature) – The e-signature is a binding agreement to documents. The U.S. government passed the E-sign bill in June 2000, which noted that e-signatures should be regarded the same as a handwritten signature.

Fair Credit Reporting Act – This federal law provides consumers with the ability to learn what information the credit reporting agencies have about them and how to dispute false data in that file.

Fair Debt Collection Practices Act – This federal law offers protection to consumers from debt collectors who participate in fraudulent, abusive or harassing activity in regards to collecting a debt.

Finance Charge – This is the cost of credit noted in dollar amount.

Fixed Interest Rate – This interest rate will not change over the loan’s lifetime.

Installment Loans – This kind of loans lays out how many payments you make and how much that payment will be each month.

Interest – This is how much the lender charges consumers for the money borrowed.

Interest Rate – This is how much the lender will charge a consumer to borrow money, typically noted in percentages.

Right of Rescission – A borrower can legally cancel a contract within three business days.

Simple Interest – This is interest calculated into the principal balance outstanding.

Truth in Lending Act – This federal law demands lenders reveal every detail regarding the loan’s cost such as actual interest rate and the loan’s terms and conditions. It must be done in a way that the borrower can understand it.

Unsecured Loan – This is a loan given to a borrower on their promise of repayment.

Variable Interest Rate – This interest rate changes based on a particular index like the prime rate.

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Representative APR 391%. Average APR for this type of loans is 391%. Let's say you want to borrow $100 for two week. Lender can charge you $15 for borrowing $100 for two weeks. You will need to return $115 to the lender at the end of 2 weeks. The cost of the $100 loan is a $15 finance charge and an annual percentage rate of 391 percent. If you decide to roll over the loan for another two weeks, lender can charge you another $15. If you roll-over the loan three times, the finance charge would climb to $60 to borrow the $100.

Implications of Non-payment: Some lenders in our network may automatically roll over your existing loan for another two weeks if you don't pay back the loan on time. Fees for renewing the loan range from lender to lender. Most of the time these fees equal the fees you paid to get the initial payday loan. We ask lenders in our network to follow legal and ethical collection practices set by industry associations and government agencies. Non-payment of a payday loan might negatively effect your credit history.

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