How does it work?
Franchising has been around for a while – most likely
because it’s a system that’s been successful. It works
when an individual or group (the franchisee)
establishes a relationship with a business (the
franchisor) to help grow that business and distribute
its product.
The franchisee pays a franchise fee to use the
franchisor’s business model and leverage its existing
brand name, while agreeing to follow the operational
terms of a contract, also known as a franchise
agreement.
With the support of an existing business model and a
recognized brand name, the franchisee typically gets
a quicker return on his or her investment.
Currently, there are over 3,000 franchise systems in
the United States, representing a range of industries.
These franchise systems represent 3.2% of all
businesses and approximately 35% of all retail and
service revenue in the country.
How much do Franchisees
make?
We get that question a lot, but it’s difficult to answer
since there are so many variables affecting a financial
bottom line. The good news is, your earning potential
can be as big as you want to make it.
Aside from a stellar work ethic, here are a few factors
that can determine your financial success.
•The kind of franchise you choose is probably one of
the biggest variables that impacts earnings.
Make sure you’re looking at a business that offers
services and products that are in demand. You won't
make money if the business is in a sector that's
oversaturated or about to implode.
•The location of a franchise also determines your
earnings. It’s important to choose a franchise located
in a community that will want what your business is
offering. Remember, traffic drives sales and sales
keep a franchise healthy and growing.
•Your ability to build strong customer loyalty
contributes to the success of a franchise. Treat your
customers like family – and they’ll keep coming back
Franchising has been around for a while – most likely
because it’s a system that’s been successful. It works
when an individual or group (the franchisee)
establishes a relationship with a business (the
franchisor) to help grow that business and distribute
its product.
The franchisee pays a franchise fee to use the
franchisor’s business model and leverage its existing
brand name, while agreeing to follow the operational
terms of a contract, also known as a franchise
agreement.
With the support of an existing business model and a
recognized brand name, the franchisee typically gets
a quicker return on his or her investment.
Currently, there are over 3,000 franchise systems in
the United States, representing a range of industries.
These franchise systems represent 3.2% of all
businesses and approximately 35% of all retail and
service revenue in the country.
How much do Franchisees
make?
We get that question a lot, but it’s difficult to answer
since there are so many variables affecting a financial
bottom line. The good news is, your earning potential
can be as big as you want to make it.
Aside from a stellar work ethic, here are a few factors
that can determine your financial success.
•The kind of franchise you choose is probably one of
the biggest variables that impacts earnings.
Make sure you’re looking at a business that offers
services and products that are in demand. You won't
make money if the business is in a sector that's
oversaturated or about to implode.
•The location of a franchise also determines your
earnings. It’s important to choose a franchise located
in a community that will want what your business is
offering. Remember, traffic drives sales and sales
keep a franchise healthy and growing.
•Your ability to build strong customer loyalty
contributes to the success of a franchise. Treat your
customers like family – and they’ll keep coming back
Are you an entrepreneur?
Why convenience stores could
be good idea to begin with?
In our 24-hour world, today’s consumers are busier
than ever and want more from one location,
whenever they want it. The U.S. convenience store
industry is feeding this 24/7 consumer demand,
With an expanded product selection, round-the-
clock operations and numerous locations,
convenience store franchises are exactly what the
masses are craving.
Franchises that focus on selling just one type of
product or service (fast-food franchises, for
example) may have a limited customer base. On
the other hand, owning a franchise that offers
multiple products allows you to meet a variety of
customer wants and needs,
which can enhance your business. Many
convenience stores offer everything from gas,
lottery tickets and household supplies, to coffee,
snacks and beer. You can make everyone happy!
Why convenience stores could
be good idea to begin with?
In our 24-hour world, today’s consumers are busier
than ever and want more from one location,
whenever they want it. The U.S. convenience store
industry is feeding this 24/7 consumer demand,
With an expanded product selection, round-the-
clock operations and numerous locations,
convenience store franchises are exactly what the
masses are craving.
Franchises that focus on selling just one type of
product or service (fast-food franchises, for
example) may have a limited customer base. On
the other hand, owning a franchise that offers
multiple products allows you to meet a variety of
customer wants and needs,
which can enhance your business. Many
convenience stores offer everything from gas,
lottery tickets and household supplies, to coffee,
snacks and beer. You can make everyone happy!
| KNOWLEDGE FINANCIAL GROUP / KNOWLEDGEFINANCIAGROUP.COM |
What's the best way to research
a franchise?
Definitely do your homework. And if possible,
talk to the men and women currently franchising
with a brand you may be interested in.
The more information you can gather, the better
decision you can make. Here are a few helpful
resources to jump-start your research. There’s
so much more out there – just keep digging.
And good luck!
The International Franchise Association: www.
franchise.org
The Business Resale Network: www.br-network.
com
The Census Bureau: www.census.gov
The Service Corps of Retired Executives
(SCORE): www.score.org
Franchise Update Publications: www.Franchise-
Update.com
Entrepreneur: www.entrepreneur.com
Franchise Times: www.franchisetimes.com
a franchise?
Definitely do your homework. And if possible,
talk to the men and women currently franchising
with a brand you may be interested in.
The more information you can gather, the better
decision you can make. Here are a few helpful
resources to jump-start your research. There’s
so much more out there – just keep digging.
And good luck!
The International Franchise Association: www.
franchise.org
The Business Resale Network: www.br-network.
com
The Census Bureau: www.census.gov
The Service Corps of Retired Executives
(SCORE): www.score.org
Franchise Update Publications: www.Franchise-
Update.com
Entrepreneur: www.entrepreneur.com
Franchise Times: www.franchisetimes.com
''How to speak the language of franchise?
Brand: The mark, name, logo and identity of a company or business, and a
franchise system’s most valuable asset.
Broker: An outside salesperson. For a fee, a broker will sell a franchise for the
franchisor.Distributorships:
The right granted by a manufacturer or wholesaler to a business to sell its products.
FDD: Franchise Disclosure Document:Provides information about the franchisor
and franchise agreement, plus a complete description of initial investment costs.
The FDD is typically shared after an initial application is completed.Franchisee: The
person that is given the right from a franchisor to do business under its brand name.
Franchise agreement: The written contract between the franchisor and the
franchisee.Franchisor: The business that grants the franchisee the right to do
business under the franchisor's brand.
FSR: Franchise Sales Recruiter:The person who works directly with
franchisees and their store operations during the start-up period.FTC:
The Federal Trade Commission:The U.S. government agency that regulates
franchising.Goodwill store:
Gross amount: The term refers to the total amount made as a result of some
activity. It can refer to things such as total profit or total sales.
Initial Franchise fee:This fee is the initial fee paid by the franchisee for the
right to use a business’ brand name and business model, receive funding and other
potential services provided by the franchisor. It is typically paid after a franchise
agreement is signed.
Initial investment: This is the initial cost of getting into business that includes
the franchise fee, inventory down payment,
cash register fund and costs for supplies, licensing, permits and bonds.Multi-unit
franchise: Franchising multiple locations within a business at one time.
Net amount: The term refers to the amount left over after all deductions are
made. Once the net value is attained, nothing else is subtracted.
Royalty fee: A continuing fee paid by the franchisee for the use of a brand and
business model.
Shared profit split: A franchise business model that splits gross profits
between the franchisor and the franchisee.
Single-store franchise: The traditional franchise model involving only one
location.
Turnkey:A franchise that is sold to a franchisee fully equipped and ready for
operation.
Vendor:A supplier of products or services.
Brand: The mark, name, logo and identity of a company or business, and a
franchise system’s most valuable asset.
Broker: An outside salesperson. For a fee, a broker will sell a franchise for the
franchisor.Distributorships:
The right granted by a manufacturer or wholesaler to a business to sell its products.
FDD: Franchise Disclosure Document:Provides information about the franchisor
and franchise agreement, plus a complete description of initial investment costs.
The FDD is typically shared after an initial application is completed.Franchisee: The
person that is given the right from a franchisor to do business under its brand name.
Franchise agreement: The written contract between the franchisor and the
franchisee.Franchisor: The business that grants the franchisee the right to do
business under the franchisor's brand.
FSR: Franchise Sales Recruiter:The person who works directly with
franchisees and their store operations during the start-up period.FTC:
The Federal Trade Commission:The U.S. government agency that regulates
franchising.Goodwill store:
Gross amount: The term refers to the total amount made as a result of some
activity. It can refer to things such as total profit or total sales.
Initial Franchise fee:This fee is the initial fee paid by the franchisee for the
right to use a business’ brand name and business model, receive funding and other
potential services provided by the franchisor. It is typically paid after a franchise
agreement is signed.
Initial investment: This is the initial cost of getting into business that includes
the franchise fee, inventory down payment,
cash register fund and costs for supplies, licensing, permits and bonds.Multi-unit
franchise: Franchising multiple locations within a business at one time.
Net amount: The term refers to the amount left over after all deductions are
made. Once the net value is attained, nothing else is subtracted.
Royalty fee: A continuing fee paid by the franchisee for the use of a brand and
business model.
Shared profit split: A franchise business model that splits gross profits
between the franchisor and the franchisee.
Single-store franchise: The traditional franchise model involving only one
location.
Turnkey:A franchise that is sold to a franchisee fully equipped and ready for
operation.
Vendor:A supplier of products or services.
Franchise: A success story that fueled by
customers’ needs...
“Give the customers what they want, when and
where they want it.”
''Business or service. extend it beyond, into the
communities where customers live, work and play.
As a Franchisee, getting to know your neighbors
opens up all kinds of opportunities to serve better
a community who's supporting you.
customers’ needs...
“Give the customers what they want, when and
where they want it.”
''Business or service. extend it beyond, into the
communities where customers live, work and play.
As a Franchisee, getting to know your neighbors
opens up all kinds of opportunities to serve better
a community who's supporting you.
Search Franchises For Sale -
Are you ready to take control of your financial future?
Business Venture – Franchise Information
''
''Franchises & Business Opportunities''
BUSINESS OPPORTUNITIES
Business opportunities may be a great option for those who
have a limited budget but still dream of owning their own
business either full-time or part-time.
Owning your own business can be extremely rewarding and
profitable. Have fun exploring the many different types of
business opportunities available.
--------------
Are you ready to take control of your financial future?
Business Venture – Franchise Information
''
''Franchises & Business Opportunities''
BUSINESS OPPORTUNITIES
Business opportunities may be a great option for those who
have a limited budget but still dream of owning their own
business either full-time or part-time.
Owning your own business can be extremely rewarding and
profitable. Have fun exploring the many different types of
business opportunities available.
--------------
EDUCATION FRANCHISES
One is truly never done learning! As infants we soak up new
information like a sponge, our brain development rapidly
progresses through infant years, then its one to grade
school, high school, then college, and perhaps, post graduate
schooling.
And that's just the start....humans are constantly learning and
seeking knowledge -- both for personal enrichment and
career development. Explore these fantastic
Education-Related Franchises and Business Opportunities
today!
One is truly never done learning! As infants we soak up new
information like a sponge, our brain development rapidly
progresses through infant years, then its one to grade
school, high school, then college, and perhaps, post graduate
schooling.
And that's just the start....humans are constantly learning and
seeking knowledge -- both for personal enrichment and
career development. Explore these fantastic
Education-Related Franchises and Business Opportunities
today!
'' List of franchise companies;;;; Top Franchises from Franchise
500 List''
https://www.entrepreneur.com/franchise500
Own your own franchise in Florida or anywhere in The US and
Canada
500 List''
https://www.entrepreneur.com/franchise500
Own your own franchise in Florida or anywhere in The US and
Canada
Franchise Businesses...
Want to be your own boss, but not willing to take on the risk of starting your own
business from scratch? Franchising can be a great alternative if you want to have
some guidance in the start-up phase of the business.
---------------------
What is Franchising?
A franchise is a business model that involves one business owner licensing
trademarks and methods to an independent entrepreneur. Sometimes, franchises are
referred to as chains.
There are two primary forms of franchising:
•Product/trade name franchising
Franchisor owns the right to the name or trademark and sells that right to a franchisee
•Business format franchising
Franchisor and franchisee have an ongoing relationship, and the franchisor often
provides a full range of services, including site selection, training, product supply,
marketing plans and even assistance in obtaining financing
-------------
Before Investing in a Franchise
Before you decide to franchise, you need to do your
research.
You could lose a significant amount of money if you do not investigate a business
carefully before you buy.
By law, franchise sellers must disclose certain information about
their business to potential buyers.
Make sure you get all the information you need first before entering into this form of
business.
To learn more about franchising opportunities, visit Federal Trade Commission
Bureau of Consumer Protection.
The decision to purchase a franchise involves many factors. To help you explore if
franchising is right for you, consider the following questions:
•Do you know how much you can invest?
•What are your abilities?
•What are your goals?
--------------------
Franchising Strategy
You need a strategy before investing in a franchise. Doing your homework about the
franchise first will help you gain a solid understanding of what to expect as well as the
risks that could be involved.
•Be a Detective In addition to the routine investigation that
should be conducted prior to any business purchase, you should be able to contact
other franchisees before deciding to invest. You can obtain a Uniform Franchise
Offering Circular (UFOC), which contains vital details about the franchise's legal,
financial, and personnel history, before you sign a contract.
---------------------
•Know What You are Getting Into Before entering into
any contract as a franchisee, you should make sure that you would
have the right to use the franchise name and trademark, receive training and
management assistance from the franchisor, use the franchisor's expertise in
marketing, advertising, facility design, layouts, displays and fixtures and do business
in an area protected from other competing franchisees.
------------------------
•Watch Out for Possible Pitfalls: The contract between the two parties
usually benefits the franchisor far more than the franchisee. The franchisee is
generally subject to meeting sales quotas and is required to purchase equipment,
supplies and inventory exclusively from the franchisor.
------------------
•Seek Professional Help The tax rules surrounding franchises are often complex, and
an attorney, preferably a specialist in franchise law, should assist you to evaluate the
franchise package and tax considerations.
An accountant may be needed to determine the full costs of purchasing and operating
the business as well as to assess the potential profit to the franchisee
Want to be your own boss, but not willing to take on the risk of starting your own
business from scratch? Franchising can be a great alternative if you want to have
some guidance in the start-up phase of the business.
---------------------
What is Franchising?
A franchise is a business model that involves one business owner licensing
trademarks and methods to an independent entrepreneur. Sometimes, franchises are
referred to as chains.
There are two primary forms of franchising:
•Product/trade name franchising
Franchisor owns the right to the name or trademark and sells that right to a franchisee
•Business format franchising
Franchisor and franchisee have an ongoing relationship, and the franchisor often
provides a full range of services, including site selection, training, product supply,
marketing plans and even assistance in obtaining financing
-------------
Before Investing in a Franchise
Before you decide to franchise, you need to do your
research.
You could lose a significant amount of money if you do not investigate a business
carefully before you buy.
By law, franchise sellers must disclose certain information about
their business to potential buyers.
Make sure you get all the information you need first before entering into this form of
business.
To learn more about franchising opportunities, visit Federal Trade Commission
Bureau of Consumer Protection.
The decision to purchase a franchise involves many factors. To help you explore if
franchising is right for you, consider the following questions:
•Do you know how much you can invest?
•What are your abilities?
•What are your goals?
--------------------
Franchising Strategy
You need a strategy before investing in a franchise. Doing your homework about the
franchise first will help you gain a solid understanding of what to expect as well as the
risks that could be involved.
•Be a Detective In addition to the routine investigation that
should be conducted prior to any business purchase, you should be able to contact
other franchisees before deciding to invest. You can obtain a Uniform Franchise
Offering Circular (UFOC), which contains vital details about the franchise's legal,
financial, and personnel history, before you sign a contract.
---------------------
•Know What You are Getting Into Before entering into
any contract as a franchisee, you should make sure that you would
have the right to use the franchise name and trademark, receive training and
management assistance from the franchisor, use the franchisor's expertise in
marketing, advertising, facility design, layouts, displays and fixtures and do business
in an area protected from other competing franchisees.
------------------------
•Watch Out for Possible Pitfalls: The contract between the two parties
usually benefits the franchisor far more than the franchisee. The franchisee is
generally subject to meeting sales quotas and is required to purchase equipment,
supplies and inventory exclusively from the franchisor.
------------------
•Seek Professional Help The tax rules surrounding franchises are often complex, and
an attorney, preferably a specialist in franchise law, should assist you to evaluate the
franchise package and tax considerations.
An accountant may be needed to determine the full costs of purchasing and operating
the business as well as to assess the potential profit to the franchisee
 |
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''Personal Finance101''
''Saving & Budgeting: How to Make a
Budget''
If you want to keep your spending under control, it's
essential that you make a budget. A budget allows you to
get a handle on the flow of your money -- how much is
coming in and where it goes out. With that information in
hand, you can make intelligent choices about how to
spend.
-------------
''Money Management 101''
Except for those folks who are born accountants, most
people find dealing with personal finances a chore.
People are loath to manage their finances for all sorts of
reasons, including not being comfortable with math, not
having time, or even being fearful of finding out that there's
just not enough money in the bank to cover the bills.
But you must have a clear understanding of your finances
to maintain or improve your financial health.
-------------------
'Home Buying Lessons Step By
Step... House Buyers Guide:
More and more young professionals are pursuing the
"American dream" by buying their first home.
If you're a recent college grad or have spent a few years
working and saving, you may be thinking about making
your first home purchase. But is that the right step for
you? Here are some things to consider
''Saving & Budgeting: How to Make a
Budget''
If you want to keep your spending under control, it's
essential that you make a budget. A budget allows you to
get a handle on the flow of your money -- how much is
coming in and where it goes out. With that information in
hand, you can make intelligent choices about how to
spend.
-------------
''Money Management 101''
Except for those folks who are born accountants, most
people find dealing with personal finances a chore.
People are loath to manage their finances for all sorts of
reasons, including not being comfortable with math, not
having time, or even being fearful of finding out that there's
just not enough money in the bank to cover the bills.
But you must have a clear understanding of your finances
to maintain or improve your financial health.
-------------------
'Home Buying Lessons Step By
Step... House Buyers Guide:
More and more young professionals are pursuing the
"American dream" by buying their first home.
If you're a recent college grad or have spent a few years
working and saving, you may be thinking about making
your first home purchase. But is that the right step for
you? Here are some things to consider
''Selling Your Home: Overview''
Selling a home brings on a whole host of questions and,
sometimes, anxieties. How much is your house really
worth? What if you set the price too high or too low?
Are you willing to pay a 5-6% commission for an agent's
help? Should you repaint or remodel before putting the
house on the market?
This article will look at the home-selling process step by
step and provide links to other sources of information
Selling a home brings on a whole host of questions and,
sometimes, anxieties. How much is your house really
worth? What if you set the price too high or too low?
Are you willing to pay a 5-6% commission for an agent's
help? Should you repaint or remodel before putting the
house on the market?
This article will look at the home-selling process step by
step and provide links to other sources of information
''Protect Your Trademark - File a Provisional
Patent -
Form a Limited Liability Company''
---------------
''Create Your Will - Create Your Living Trust''
-----------
''Social Security & Retirement'' Learn about
eligibility for Social Security benefits -
------------
When to Claim Social Security Benefits
Should you claim social security benefits at early
retirement age, full retirement age, or later? Learn
the pros and cons of each option..
------------
Medicare & Medicaid
Medicare and Medicaid: What's the Difference?
Medicare and Medicaid are very different:
Medicaid is a federal need-based program,
while Medicare is a federal entitlement program
based on your employment history.
You may qualify for and receive coverage from
both Medicare and Medicaid..
-----------------
Patent -
Form a Limited Liability Company''
---------------
''Create Your Will - Create Your Living Trust''
-----------
''Social Security & Retirement'' Learn about
eligibility for Social Security benefits -
------------
When to Claim Social Security Benefits
Should you claim social security benefits at early
retirement age, full retirement age, or later? Learn
the pros and cons of each option..
------------
Medicare & Medicaid
Medicare and Medicaid: What's the Difference?
Medicare and Medicaid are very different:
Medicaid is a federal need-based program,
while Medicare is a federal entitlement program
based on your employment history.
You may qualify for and receive coverage from
both Medicare and Medicaid..
-----------------
''Franchise: All You Need to Know About Franchising''
Knowledge Financial Group – And
Femkonsa Capital Investment
make finding investment ideas
easy with our Research Learning
Center.
------------------
{Create, Preserve, Protect and
grow your wealth…}
Real Estate And Life Insurance:
We're here to help— We’re here to
serve -
However and whenever you need
us.
No matter what life insurance, real
estate, or financial questions you
may have, we're here to provide
an answer to you. Just contact
us…
Femkonsa Capital Investment
make finding investment ideas
easy with our Research Learning
Center.
------------------
{Create, Preserve, Protect and
grow your wealth…}
Real Estate And Life Insurance:
We're here to help— We’re here to
serve -
However and whenever you need
us.
No matter what life insurance, real
estate, or financial questions you
may have, we're here to provide
an answer to you. Just contact
us…
Free Financial Education At Knowledge Financial Group..
Resources You Need to Succeed to Start a Business.
Anyone can start a business. But to start a business that
succeeds and continues to flourish isn’t so easy that's why
Knowledge Financial Group - knowledgefinancial.com is there to
help.
Resources You Need to Succeed to Start a Business.
Anyone can start a business. But to start a business that
succeeds and continues to flourish isn’t so easy that's why
Knowledge Financial Group - knowledgefinancial.com is there to
help.
''Business Startup 101''
Everything You Need to Know About Starting Your Own
Business
''Interested in Starting a Home Business?
Home businesses are one of most popular types of business
to start. And why not?
A home-based business can be absolutely ideal for people
who want to be at home with their kids or for people who want
to run online businesses
-----------
''How to Start a Successful Business''
No matter what type of business you choose to start, give
yourself a huge leg up by spending some time delving into
these advice articles on how to make your new business a
success. No one starts out wanting to start a business that
fails, but many do
------------
Everything You Need to Know About Starting Your Own
Business
''Interested in Starting a Home Business?
Home businesses are one of most popular types of business
to start. And why not?
A home-based business can be absolutely ideal for people
who want to be at home with their kids or for people who want
to run online businesses
-----------
''How to Start a Successful Business''
No matter what type of business you choose to start, give
yourself a huge leg up by spending some time delving into
these advice articles on how to make your new business a
success. No one starts out wanting to start a business that
fails, but many do
------------
Knowledge Financial Group empowers
people with financial knowledge,
financial skills and education..
--------
Commitment
We carry a passion for the
transformative power for financial
literacy to lift up individuals, families,
communities, and entire economies.
--------------
Innovation
Our creativity has produced
evidence-based solutions that have
become the global standard in financial
education for business.
-----------
Work in one of today's top-rated careers.
Help clients achieve financial security.
Develop financial strategies to meet
clients' changing needs.
Create customized solutions in the
long-term best interest of clients.
Apply your financial knowledge and
expertise.
Have the potential to earn unlimited
income.
people with financial knowledge,
financial skills and education..
--------
Commitment
We carry a passion for the
transformative power for financial
literacy to lift up individuals, families,
communities, and entire economies.
--------------
Innovation
Our creativity has produced
evidence-based solutions that have
become the global standard in financial
education for business.
-----------
Work in one of today's top-rated careers.
Help clients achieve financial security.
Develop financial strategies to meet
clients' changing needs.
Create customized solutions in the
long-term best interest of clients.
Apply your financial knowledge and
expertise.
Have the potential to earn unlimited
income.
Core Values
1. Lead With Your Heart and
Serve. Alakaʻi mai ka naʻau mai.
2. Be Humble and Grateful.
3. Family Comes First.
4. Do the Right Thing.
5. Share the Message of
Financial Hope Through Example.
6. Care For Each Student and
Instructor.
7. Smile, Laugh and Have Fun.
8. Do More With Less.
9. Learn Something New Every
day.
1. Lead With Your Heart and
Serve. Alakaʻi mai ka naʻau mai.
2. Be Humble and Grateful.
3. Family Comes First.
4. Do the Right Thing.
5. Share the Message of
Financial Hope Through Example.
6. Care For Each Student and
Instructor.
7. Smile, Laugh and Have Fun.
8. Do More With Less.
9. Learn Something New Every
day.
Our philosophy is built upon the
following principles:
A. Clients come first ..
B. Build long-term relationships
by exceeding our clients’
expectations..
C. Become a trusted partner with
each of our clients..
D. Remain focused on investment
principles we can control:
E. Cash Flow – Diversification -
Tax Efficiency - Cost Control.
following principles:
A. Clients come first ..
B. Build long-term relationships
by exceeding our clients’
expectations..
C. Become a trusted partner with
each of our clients..
D. Remain focused on investment
principles we can control:
E. Cash Flow – Diversification -
Tax Efficiency - Cost Control.
Be ready for wherever life takes
you.
''Join us for the latest seminars about investment,
taxes, real estate, retirement pans etc.
-----------
Discover key strategies to help you plan a long-
lasting and successful retirement.
''Retirement Accounts And IRA’s – Pension Plans:
------------
''Investment & Retirement:
How to manage your investments and generate
the income you need during retirement age.
-------------
''Social Security:
Learn how to maximize benefits and exploit all the
options of medicare & medicaid for yourself, your
family.
-----------
''Estate Planning:
Learn how to ensure your assets are protected
and distributed as you want with no surprises.
-------------
''Will & Living Trust:
Learn how to prepare a will, or and living trust to
be certain that your wishes are well respected.
-------------
''Insurance Knowledge:
Learn how to better protect your loved ones, your
family, Protect your dignity!
Learn how to benefit from life insurance policy
while you’re alive.
-----------
Find Your Ideal Home Here – Buy
Or Sell Your Real Estate Property Right Here With
a South Florida Real Estate Professional –
Reliable, Trustworthy. Uncompromise
Personalize Professional Service..
----------------
''Knowledge is power!
The more knowledgeable you’re the more
powerful you’ll be. So in this case Knowledge
Financial Group – knowledgefinancial.com is the
solution.
you.
''Join us for the latest seminars about investment,
taxes, real estate, retirement pans etc.
-----------
Discover key strategies to help you plan a long-
lasting and successful retirement.
''Retirement Accounts And IRA’s – Pension Plans:
------------
''Investment & Retirement:
How to manage your investments and generate
the income you need during retirement age.
-------------
''Social Security:
Learn how to maximize benefits and exploit all the
options of medicare & medicaid for yourself, your
family.
-----------
''Estate Planning:
Learn how to ensure your assets are protected
and distributed as you want with no surprises.
-------------
''Will & Living Trust:
Learn how to prepare a will, or and living trust to
be certain that your wishes are well respected.
-------------
''Insurance Knowledge:
Learn how to better protect your loved ones, your
family, Protect your dignity!
Learn how to benefit from life insurance policy
while you’re alive.
-----------
Find Your Ideal Home Here – Buy
Or Sell Your Real Estate Property Right Here With
a South Florida Real Estate Professional –
Reliable, Trustworthy. Uncompromise
Personalize Professional Service..
----------------
''Knowledge is power!
The more knowledgeable you’re the more
powerful you’ll be. So in this case Knowledge
Financial Group – knowledgefinancial.com is the
solution.
We Promote Financial Literacy To Parents –
Teachers & Students.
------
Parents can use Knowledge Financial Group –
knowledgefinancial.com for investing
strategies and to educate themselves more
about finance, investing, business, real estate,
insurance etc.
-------------
Teacher can use Knowledge Financial Group –
knowledgefinancial.com as classroom tool and
resources.
------------
Students can use Knowledge Financial Group –
knowledgefinancial.com as research & learning
to increase their skills in different topics and
subjects.
--------------
''Your Search For A New Job Begins Here.
''Search Now!
Teachers & Students.
------
Parents can use Knowledge Financial Group –
knowledgefinancial.com for investing
strategies and to educate themselves more
about finance, investing, business, real estate,
insurance etc.
-------------
Teacher can use Knowledge Financial Group –
knowledgefinancial.com as classroom tool and
resources.
------------
Students can use Knowledge Financial Group –
knowledgefinancial.com as research & learning
to increase their skills in different topics and
subjects.
--------------
''Your Search For A New Job Begins Here.
''Search Now!
Simplify the Home Buying Process With The Help Of Anthony Jeanty,
South Florida Real Estate Professional - Knowledgefinancial.com
''Real Estate Investing: Four -4- Important Things you can do
when buying real estate properties:
-----------
1. You can flip it and obtain cash on cash
return
-----------
2. Fix it and put it on the market for sale,
certainly for a greater return
------------
3. You can rent it for monthly cash flow by
just letting someone else paying the
mortgage for you.
-----------
4. Live in it and let it build equity overtime
and letter on it will be completely yours free
and clear with zero mortgage payment
--------------
''Real Estate:
buy it – live in it – flip it for profits, repair it and sell it forgreater return
or you can just rent it for a positive monthly cash flow.
--------------
Wise real estate professionals act accordingly; Anthony Jeanty, the south
Florida friendly neighborhood real estate agent will assist clients Before,
during and after any transaction.
We put our clients interest first.
----
We assist our clients from the beginning to the end.
We’re a reliable, dependable real estate professionals. SOUTH FL.
CONTACT US.
Anthony Jeanty, Agent Anthony Is Proud To Serve
& To Help The People In Miami Dade, Broward &
Palm Beach County, Florida With Their Real
Estate Needs And Also Life Insurance.
South Florida Real Estate Professional - Knowledgefinancial.com
''Real Estate Investing: Four -4- Important Things you can do
when buying real estate properties:
-----------
1. You can flip it and obtain cash on cash
return
-----------
2. Fix it and put it on the market for sale,
certainly for a greater return
------------
3. You can rent it for monthly cash flow by
just letting someone else paying the
mortgage for you.
-----------
4. Live in it and let it build equity overtime
and letter on it will be completely yours free
and clear with zero mortgage payment
--------------
''Real Estate:
buy it – live in it – flip it for profits, repair it and sell it forgreater return
or you can just rent it for a positive monthly cash flow.
--------------
Wise real estate professionals act accordingly; Anthony Jeanty, the south
Florida friendly neighborhood real estate agent will assist clients Before,
during and after any transaction.
We put our clients interest first.
----
We assist our clients from the beginning to the end.
We’re a reliable, dependable real estate professionals. SOUTH FL.
CONTACT US.
Anthony Jeanty, Agent Anthony Is Proud To Serve
& To Help The People In Miami Dade, Broward &
Palm Beach County, Florida With Their Real
Estate Needs And Also Life Insurance.
| Remember real estate business has 3 P’ s: People, Prosperity, and process. ----------- Wise real estate professionals act accordingly; Anthony Jeanty, the south Florida real estate agent ----------- Before, during and after any transaction we put our clients interest first. ---- We assist our clients from the beginning to the end. We’re a reliable, dependable real estate professionals Real Estate investing buy and hold: Here’s what you need to know before making that important decision. |
| Remember the 3 L’s of real estate… #1. Location – location – location What to expect, what happening now and will or can happen in the surrounding area in the next 5, 10, 15 years. --------- #2. The state of the job market #3. Quality of the schools #4. How the public transportation is #5. Property values – Resale Values #6. Crime statistic and condition of local market, supply and demand ---------- The financial rewards are well worth the acquiring knowledge. |
1. Rules of the Road for Investing
- Consider your life stage..
It's important to understand how your life stage impacts
your financial situation.
For example, if you're younger and retirement is a long
way off, your investments will probably look different
than if you're planning to retire in five years.
2. Develop your strategy.
Your financial advisor gets to know you – your long-term
goals, investment time frame and comfort level with risk
– before recommending a strategy.
The more you can outline what you are trying to achieve,
the more he or she can tailor your strategy to you.
---------------
3. Weigh your risk tolerance
Your risk tolerance, or how much risk you're comfortable
taking, makes a big difference when choosing
appropriate investments.
-------------
Understand risk.
As a rule, the higher the return potential, the more risk
you’ll have to accept. To determine what makes sense
for you, your financial advisor will want to know:
What is your comfort level with risk? Understanding this
can help him or her determine how you may react to
market ups and downs over time.
-------------
How much risk are you able to take?
The amount of time you have to invest plays an
important role in determining how much risk you’re able
to take
----------
4. Identify a portfolio objective
A Portfolio Objective helps you and your financial
advisor determine the mix of investments that's right for
your unique financial situation.
-------------
5. Diversify for a solid
foundation.
Your portfolio’s foundation is your asset allocation, or
how your investments are diversified among stocks,
bonds, cash, international and other investments. Your
mix should align with your goals and comfort with risk.
----------
6. Stick with quality.
Of all the factors to consider when investing, Edward
Jones believes quality is one of the most important. It’s
also one of the most overlooked. Although it may be
tempting to buy a popular investment, it may not fit with
the rest of your portfolio, and it may be riskier than you
expect. If it sounds too good to be true, it probably is.
------------
7. Invest for the long term.
Despite stories of fortunes made on one or two trades,
most successful individual investors make their money
over time, not overnight. One of the biggest mistakes
you can make is trying to “time” the markets.
----------
8. Have realistic expectations.
First, you’ll need to determine the return you’re trying to
achieve – which should be the return you need to reach
your goals. Then you can base your expectations on
your asset allocation, the market environment and your
investment time frame.
----------------
9. Prepare for the unexpected.
Unforeseen events could derail what you’re working so
hard to achieve. By preparing for the unexpected and
building a strategy to address it, you’ll be better
positioned to handle the inevitable bumps along the way.
------------
10. Focus on what you can control.
You can’t control market fluctuations, the economy or
the political environment. Instead, you should base your
decisions on time-tested investment principles, which
include:
Diversifying your portfolio
Owning quality investments
Maintaining a long-term perspective
----------
11. Review your strategy regularly.
The one constant you can expect is change. That’s why
it’s so important that you and your financial advisor
review your strategy on a regular basis.
- Consider your life stage..
It's important to understand how your life stage impacts
your financial situation.
For example, if you're younger and retirement is a long
way off, your investments will probably look different
than if you're planning to retire in five years.
2. Develop your strategy.
Your financial advisor gets to know you – your long-term
goals, investment time frame and comfort level with risk
– before recommending a strategy.
The more you can outline what you are trying to achieve,
the more he or she can tailor your strategy to you.
---------------
3. Weigh your risk tolerance
Your risk tolerance, or how much risk you're comfortable
taking, makes a big difference when choosing
appropriate investments.
-------------
Understand risk.
As a rule, the higher the return potential, the more risk
you’ll have to accept. To determine what makes sense
for you, your financial advisor will want to know:
What is your comfort level with risk? Understanding this
can help him or her determine how you may react to
market ups and downs over time.
-------------
How much risk are you able to take?
The amount of time you have to invest plays an
important role in determining how much risk you’re able
to take
----------
4. Identify a portfolio objective
A Portfolio Objective helps you and your financial
advisor determine the mix of investments that's right for
your unique financial situation.
-------------
5. Diversify for a solid
foundation.
Your portfolio’s foundation is your asset allocation, or
how your investments are diversified among stocks,
bonds, cash, international and other investments. Your
mix should align with your goals and comfort with risk.
----------
6. Stick with quality.
Of all the factors to consider when investing, Edward
Jones believes quality is one of the most important. It’s
also one of the most overlooked. Although it may be
tempting to buy a popular investment, it may not fit with
the rest of your portfolio, and it may be riskier than you
expect. If it sounds too good to be true, it probably is.
------------
7. Invest for the long term.
Despite stories of fortunes made on one or two trades,
most successful individual investors make their money
over time, not overnight. One of the biggest mistakes
you can make is trying to “time” the markets.
----------
8. Have realistic expectations.
First, you’ll need to determine the return you’re trying to
achieve – which should be the return you need to reach
your goals. Then you can base your expectations on
your asset allocation, the market environment and your
investment time frame.
----------------
9. Prepare for the unexpected.
Unforeseen events could derail what you’re working so
hard to achieve. By preparing for the unexpected and
building a strategy to address it, you’ll be better
positioned to handle the inevitable bumps along the way.
------------
10. Focus on what you can control.
You can’t control market fluctuations, the economy or
the political environment. Instead, you should base your
decisions on time-tested investment principles, which
include:
Diversifying your portfolio
Owning quality investments
Maintaining a long-term perspective
----------
11. Review your strategy regularly.
The one constant you can expect is change. That’s why
it’s so important that you and your financial advisor
review your strategy on a regular basis.
''Real Estate And Mortgage
Learning Center...
Don't Buy a Real Estate Without
Learning These Major Money-
Saving Tips, Techniques, &
Strategies.
-----------
Renting might be ideal for people who don't want to
be tied down or deal with costly home repairs and
the 3 T’s of landlording which are:
Tenants – Toilets - Trash.
-----------------
Owning a home also presents an
opportunity to earn equity and write
off mortgage interest, renting it for monthly cash-
flow, or selling it for profits, renovate it in your own
taste. Those advantages you don’t have them when
you renting.
-------------
But even considering these financial rewards, the
process of buying a home is pricey.
There are costs before, during and after a purchase.
And if you don't prepare, you'll get more than you
bargained for.
A common question is: How
much are closing costs and other
fees? From inspections to real estate agent fees,
there are a lot of little fees that add up to a lot when
you buy a house, so it’s best to be prepared ahead
of time.
Learning Center...
Don't Buy a Real Estate Without
Learning These Major Money-
Saving Tips, Techniques, &
Strategies.
-----------
Renting might be ideal for people who don't want to
be tied down or deal with costly home repairs and
the 3 T’s of landlording which are:
Tenants – Toilets - Trash.
-----------------
Owning a home also presents an
opportunity to earn equity and write
off mortgage interest, renting it for monthly cash-
flow, or selling it for profits, renovate it in your own
taste. Those advantages you don’t have them when
you renting.
-------------
But even considering these financial rewards, the
process of buying a home is pricey.
There are costs before, during and after a purchase.
And if you don't prepare, you'll get more than you
bargained for.
A common question is: How
much are closing costs and other
fees? From inspections to real estate agent fees,
there are a lot of little fees that add up to a lot when
you buy a house, so it’s best to be prepared ahead
of time.
''Learn How to Start Investing Your
Money ''
Ways You Can Start Investing and
Getting Your Money to Work for You
Instead Of You Working For All Your
Life.
------------
Give Money A Chance To Work For
You..
You want to learn how to start
investing. Congratulations!
--------
Taking this first step is one of the
most important things you can do for
yourself and, in many cases, your
family.
Implemented wisely and with enough
time to let compounding work its
magic, it can lead to a life of financial
independence as you spend your
time pursuing your passions rather
than selling your time
Money ''
Ways You Can Start Investing and
Getting Your Money to Work for You
Instead Of You Working For All Your
Life.
------------
Give Money A Chance To Work For
You..
You want to learn how to start
investing. Congratulations!
--------
Taking this first step is one of the
most important things you can do for
yourself and, in many cases, your
family.
Implemented wisely and with enough
time to let compounding work its
magic, it can lead to a life of financial
independence as you spend your
time pursuing your passions rather
than selling your time
| '' How To Own Investment Homes - Income Producing Properties -. LEARN MORE... ------- '' The south Florida Real Estate Market Update: Buying - Selling - Investing - Renting. LEARN MORE... -------------- '' Real Estate Info About: Single Family Home - Town-home - Co-Op - Condominiums - - Timeshare. LEARN MORE... ------------- '' Real estate Portfolios. How To Find The Best Real Estate Investments? Do You Know That There are About At Least 10 Ten Different Ways To Invest In Real Estate? LEARN MORE.. -------------- Commercial Real Estate: Ways to Evaluate Commercial Property.. How To Get Involve In Commercial Properties? LEARN MORE... ---------------- '' Real Estate News And Blogs: '' Real Estate Investing Tools & Resources. LEARN MORE... ---------------- ' '' FREE Home Value Report! '' How Much Is This House Worth? '' Find Out Now For FREE Fast, Easy & Simple. - Free Comparative Market Analysis (CMA) - '' Free Broker's price opinions { B P O }... LEARN MORE... -------------- '' Home Inspection: Here's What Everyone Needs To Know About Home Inspectors & Inspection Step One - Step Two & Step Three.. LEARN MORE... --------------- '' Real Estate For Seniors // / '' Real Estate For Buyers / ' Real Estate Listings // = Real Estate For Investors =// ------------ = '' Find 55+ Communities - Affordable Retirement Communities... Look At Few Best Affordable Places to Buy a Retirement Home This Year... |
| '' Learning Tools And Resources '' '' Investment Conference & Seminars '' '' Banking & Finance -'' '' Business & Investing -'' '' Economy & Commerce -'' '' Entrepreneurship & Employment -'' '' Government Help & Subsidies -'' '' Business Information Center -'' '' Portfolio Directory & Wealth Management'' '' Investment Account & Brokerage Firms '' |
| '' Knowledge Is The Most Powerful Ingredient In The Recipe Of Success & Knowledge Is The Pathway To Financial Security, Freedom, And Economic Independence. Guess What? The Best Knowledge Starts Here At Knowledge Financial Group - Knowledgefinancialgroup.com - Here, We Empower, We Inspire, We Educate, We Inform, & we Motivate'' |
| ‘’Financial Group /-/ Resource Center /–/ Knowledge Center /–/ Financial Service /–/ Personal Finance /– / / Wealth Management /– / Financial Planning /–/ /-/ Investing Tips /–/ Wall Street Market /– Financial Literacy -/ / / Investment Help & Options /- / Market Advice /- / Real Estate /-/ Insurance /-/ Millionaire /-/ Portfolio /-/ Commodity Trading / - / Self Directed IRA / - / Options Contract / - / Investing In OIL & Gas / - / |
'' Banking And Finance ''
'' Investing Basic ''
'' Investing In Stocks ''
'' Investing In Mutual Funds ''
'' Investing In Index Funds ''
'' Investing For Retirement ''
'' Investing In Insurance ''
'' Investing In Bonds ''
'' Investing In Residential Real Estate''
'' Investing In Commercial Real Estate''
'' Investing In Tax Lien Certificates ''
'' Investing In Forex Market ''
'' Accounting Basic ''
'' Personal Finance ''
'' Fortune Builder ''
'' Wall Street Market Millionaire ''
'' 101 Ways To Make Money ''
'' Retirement Planning ''
'' IRA's - 401k's - Pension Plan ''
'' Life Insurance ''
'' Business Start Up ''
'' Business Blogs ''
'' Investing Blogs
'' Financial Blogs''
'' Financial Literacy ''
'' Money Management ''
'' American Dollar ''
'' Millionaire Mind Set ''
'' Earned Income''
'' Passive Income ''
'' Portfolio Income ''
'' Residual Income ''
'' Free Credit Report ''
'' Investing Basic ''
'' Investing In Stocks ''
'' Investing In Mutual Funds ''
'' Investing In Index Funds ''
'' Investing For Retirement ''
'' Investing In Insurance ''
'' Investing In Bonds ''
'' Investing In Residential Real Estate''
'' Investing In Commercial Real Estate''
'' Investing In Tax Lien Certificates ''
'' Investing In Forex Market ''
'' Accounting Basic ''
'' Personal Finance ''
'' Fortune Builder ''
'' Wall Street Market Millionaire ''
'' 101 Ways To Make Money ''
'' Retirement Planning ''
'' IRA's - 401k's - Pension Plan ''
'' Life Insurance ''
'' Business Start Up ''
'' Business Blogs ''
'' Investing Blogs
'' Financial Blogs''
'' Financial Literacy ''
'' Money Management ''
'' American Dollar ''
'' Millionaire Mind Set ''
'' Earned Income''
'' Passive Income ''
'' Portfolio Income ''
'' Residual Income ''
'' Free Credit Report ''
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''' Personal Finance Terms - Important Knowledge And Information'''
A - B - C - D - E - F - G - H - I - J - L - M - N - O - P - Q - R - S - T - U - V
1/1 ARM: An adjustable-rate mortgage that has a set initial interest rate for the first year. After that period, the mortgage rate adjusts
each year. Each annual rate adjustment is based on (or “indexed to”) another rate, often the yield on a U.S. Treasury note.
10/1 ARM: An adjustable-rate mortgage that has a set initial interest rate for the first 10 years. After that period, the mortgage rate
adjusts each year.
3/1 Interest-Only ARM: An adjustable rate mortgage in which none of the payments go toward paying off the loan principal for the first
three years.
3-in-1 Credit Report: Also called a merged credit report, this type of report includes your credit data from TransUnion, Equifax and
Experian in a side-by-side format for easy comparison. You can order your 3-in-1 Credit Report online anytime.
80-10-10 Loan: A combination of an 80% loan-to-value first mortgage, a 10% home equity loan and a 10% down payment. The loans
can be used to eliminate the need for private mortgage insurance.
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A
'' KNOWLEDGE FINANCIAL GROUP AND WEALTH MANAGEMENT ''
ACH: Automated Clearing House. This is a national network that allows for transferring funds electronically between businesses,
consumers and financial institutions.
Adjustable Rate Mortgage (ARM): A home loan where the interest rate is changed periodically based on a standard financial
index.
ARM’s offer lower initial interest rates with the risk of rates increasing in the future. In comparison, a fixed rate mortgage (FRM’s) offers
a higher rate that will not change for the length of the loan. ARMs often have caps on how much the interest rate can rise or fall. You
can shop and compare mortgage options securely online.
Alternative Mortgage: Any home loan that is not a standard fixed-rate mortgage. This includes ARM’s, reverse mortgages and jumbo
mortgages.
Alias: A note on your credit report that indicates other names used for your financial accounts. Sometimes marked as “Also Known
As” or “AKA.” This can include maiden names or variations on the spelling and format of your full name.
Amortization: The process of gradually repaying a debt with regularly scheduled payments.
AnnualCreditReport.com: The official website for obtaining your free credit report disclosures from the credit bureaus, Equifax,
Experian and TransUnion. You have the right to request your credit reports online, by phone or by mail for free once every 12 months
under FACT Act regulations. This free service can only be used once a year and does not include your credit scores or any credit
monitoring services.
Annual Fee: A charge sometimes required by credit card companies for use of an account. Annual fees range between $10-50 a year
and are most common with rewards cards or cards for subprime borrowers.
Annual Percentage Rate (APR): The interest rate being charged on a debt, expressed as a yearly rate. Credit cards often have
several
different APR’s - one for purchases, one for cash advances and one for balance transfers. Some lenders may increase the APR if a
payment is late.
Application Fee: Amount a lender charges to process loan application documents. Quality lenders do not charge these fees (though
they may charge many others).
Application Scoring: A specific kind of statistical scoring that businesses use to evaluate an applicant for acceptance or denial. Similar
to credit scoring, application scoring often factors in other relevant details such as employment status and income to determine risk.
Appraisal Fee: The amount charged to deliver a professional opinion about how much a property is worth. For a standard home or
condominium, this fee is usually around $200-500.
Appraised Value: An educated opinion of how much a property is worth. An appraiser considers the price of similar homes in the area,
the condition of the home and the features of the property to estimate the value. Request a free home value estimate .
Asset: Assets are things owned by a person that have cash value. This can include homes, cars, boats, savings and investments.
Authorized User: Anyone who uses your credit cards or credit accounts with your permission. More specifically, someone who has a
credit card from your account with their name on it. An authorized user is not legally responsible for the debt and will not get credit
score benefit from it. However, the account may appear on their credit report.
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B
KNOWLEDGE FINANCIAL GROUP AND WEALTH MANAGEMENT -
KNOWLEDGEFINANCIALGROUP.COM
Back-End Ratio or Back Ratio: The sum of your monthly mortgage payment and all other monthly debts (credit cards, car payments,
student loans, etc.) divided by your monthly pre-tax income. Traditionally, lenders wouldn’t give people loans that increased this ratio
past 36%, but they often do now. (See Debt-to-Income Ratio)
Balance Transfer: The process of moving all or part of the outstanding balance on one credit card to another account. Credit card
companies often offer special rates for balance transfers. Compare your credit card options online today .
Balloon Payment: A loan where the payments don’t pay off the principal in full by the end of the term. When the loan term expires
(usually after 5-7 years), the borrower must pay a balloon payment for the remaining amount or refinance. Balloon loans sometimes
include convertible options that allow the remaining amount to automatically be transferred into a long-term mortgage. (See
Convertible ARM)
Bankruptcy: A proceeding that legally releases a person from repaying a portion or all debts owed. Bankruptcy damages your credit
for 7-10 years and should only be considered as a last resort if you cannot repay your debts. (See Chapter 7-13 Bankruptcy)
Beacon Score: A specific credit score developed by Equifax. There are thousands of slightly different credit scoring formulas used by
bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit data. Check your
credit score online .
Bi-Weekly Mortgage: A mortgage that schedules payments every two weeks instead of the standard monthly payment. The 26 bi-
weekly payments are each equal to one-half of a monthly payment. The result is that the mortgage is paid off sooner.
Broker Premium: The amount a mortgage broker is paid for serving as the middleman between a lender and a borrower. This premium
comes from the surcharge a broker applies to a discounted loan before offering it to a borrower.
Borrower: The individual who is requesting the loan and who will be responsible to pay it back.
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C
Cardholder: The person who is issued a credit card and/or any authorized users.
Cash Advance: A cash loan requested from your creditor, usually through using your credit card at an ATM machine. Or a loan
advance on your paycheck. These loans include special interest rates charged on the amount of the advance.
Cash-Out Refinance: A new mortgage for an existing property in which the amount borrowed is greater than the amount of the
previous mortgage. The difference is given to the borrower in cash when the loan is closed.
Chapter 7 Bankruptcy: A type of consumer bankruptcy where your responsibility for your debts is cleared entirely. With this kind of
bankruptcy you are not required to pay back debts you owe from before your filing. Chapter 7 bankruptcy filing records remain on
your credit report for 10 years and the record of each account included in your filing will remain on your report for 7 years. This has
been the most common type of filing but changes to bankruptcy law will make it more difficult to file for Chapter 7 bankruptcy in the
future.
Chapter 11 Bankruptcy: A complex type of bankruptcy usually filed by businesses that wish to restructure their debts.
Chapter 12 Bankruptcy: A type of bankruptcy specifically for farmers and fishermen. Similar to Chapter 13 bankruptcy but with a few
special benefits.
Chapter 13 Bankruptcy: A type of bankruptcy where the consumer must pay off some of their debts over time. Chapter 13 bankruptcy
filing records remain on your credit report for 7 years from the discharge date or 10 years from the filing date if it is not discharged.
Each account included in the filing will remain on your report for 7 years.
Charge-Off: When a creditor or lender writes off the balance of a delinquent debt, no longer expecting it to be repaid. A charge-off is
also known as a bad debt. Charge-off records remain on your credit report for 7 years and will harm your credit score. After a debt is
charged-off, it can be sold to a collections agency.
ChexSystems: A credit reporting company that tracks your banking history and provides this data to banks when you apply for a new
checking account. Negative records, such as bounced checks, can be kept in their database for up to five years. If there are errors on
your ChexSystems record, you can contact the company to submit a dispute.
Closing Costs: The amounts charged to a consumer when they are transferring ownership or borrowing against a property. Closing
costs include lender, title and escrow fees and usually range from 3-6% of the purchase price.
Collateral: An asset or property used as security against a loan. (See Secured Credit Card)
Collections: When a business sells your debt for a reduced amount to an agency in order to recover the amounts owed. Credit card
debts, medical bills, cell phone bills, utility charges, library fees and video store fees are often sold to collections. Collection agencies
attempt to recover past-due debts by contacting the borrower via phone and mail. Collection records can remain on your credit report
for 7 years from the last 180 day late payment on the original debt. Your rights are defined by the Fair Debt Collection Practices Act .
Combined Loan-to-Value Ratio: The total amount you are borrowing in mortgage debts divided by the home’s fair market value.
Someone with a $50,000 first mortgage and a $20,000 equity line secured against a $100,000 house would have a CLTV ratio of 70%.
Commitment Fee: A fee paid by a borrower to a lender in exchange for a promise to lend money on certain terms for a specified period.
Usually charged in order to extend a loan approval offer for longer than the 30-60 day standard period. Quality lenders don’t usually
charge these fees.
Conforming Loan: A mortgage that meets the requirements for purchase by Fannie Mae and Freddie Mac. Requirements include size
of the loan, type and age. Current loan size limits for single-family homes range between $200,000 and $400,000. Loans that exceed
the conforming size are considered jumbo mortgages and usually have higher interest rates.
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Co-Signer: An additional person who signs a loan document and takes equal responsibility for the debt. A borrower may want to use a
co-signer if their credit or financial situation is not good enough to qualify for a loan on their own. A co-signer is legally responsible for
the loan and the shared account will appear on their credit report. Having a co-signer is only helpful if the co-signer’s credit or financial
standing is better than the primary lender.
Convenience Check: Checks provided by your credit card company that you can use to access your available credit. These checks
often have different rates and terms than your standard credit card charges.
Convertible ARM: An adjustable rate mortgage that can be converted to a fixed-rate mortgage under specified conditions.
Credit Bureaus: Also known as credit reporting agencies, these companies collect information from creditors and lenders about
consumer financial behavior. This data is then provided to businesses that want to evaluate how risky it would be to lend money to a
potential borrower. Once a low-tech system of regional credit reporting agencies, the industry is now consolidated into the three
national credit bureaus - Equifax, Experian and TransUnion. FICO is not a credit bureau; instead they are company that develops
credit scoring formulas. Click here to order your credit reports from all three bureaus online .
Credit Counseling: A service that helps consumers repay their debts and improve their credit. Usually non-profit companies, most of
these agencies offer helpful and affordable services. Consumers should be aware that there are also credit counseling agencies that
are expensive, ineffective and even damaging to the client’s credit (see Credit Repair). Consumers should carefully review the
company’s reputation and services before signing up.
Credit File: Another term for your credit report . The term credit file is usually used to indicate the full record of your credit history
maintained by a credit bureau. Your credit report may not include all the information in your credit file.
Credit History: Another term for the information on your credit report. Your credit history is a record of how you have has repaid your
credit obligations in the past.
Credit Limit: The total amount that a company will allow you to charge to a credit card or credit line. It’s best for your credit score to
keep your credit card balances below 35% of your credit limit. If you spend more than your credit limit, you will be charged an
“overage fee” of about $10-50.
Credit Obligation: An agreement where a person becomes legally responsible for paying back borrowed money.
Credit Repair: A generally unscrupulous or illegal form of credit counseling that promises the impossible, such as erasing accurate
records from your credit report.
Credit Report: The individual records of consumer financial behavior kept by credit bureaus and provided to businesses when they
want to evaluate potential borrowers. Credit reports include records on: consumer name, current and former addresses, employment,
credit and loan histories, inquiries, collection records, and public records such as bankruptcy filings and tax liens. You can purchase
your credit reports online anytime .
Credit Score: A numerical evaluation of your credit history used by businesses to quickly understand how risky a borrower you are.
Credit scores are calculated using complex mathematical formulas that look at your most current payment history, debts, credit
history, inquiries and other factors from your credit report. Credit scores usually range from 300-850, with 680 or higher considered to
be “good” credit scores. There are thousands of slightly different credit scoring formulas (including FICO, Beacon and Empirca
scores) used by bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit data.
Click here to check your credit score online .
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Debt: The amount of money owed.
Debt Consolidation: A process of combining debts into one loan or repayment plan. Debt consolidation can be done on your own,
with a financial institution or through a counseling service. Student loans are often consolidated in order to secure a lower interest
rate. (See Debt Counseling and Debt Settlement)
Debt Counseling: A type of credit counseling that focuses specifically on helping people with debt issues. Instead of consolidating
debts into one loan, debt counseling agencies negotiate with your creditors using pre-set agreements and spread your payments over
a longer period in order to reduce the monthly amount due. Usually non-profit companies, most of these agencies offer helpful and
affordable services. Consumers should be aware that there are also debt counseling agencies that are expensive, ineffective and even
damaging to the client’s credit score (see Credit Repair).
Debt Settlement: A process where you pay an agency to negotiate directly with your creditors in the hopes of making significantly
reduced settlements for your debts. Working with a debt settlement company can result in damaged credit from numerous late
payments and collection records. Consumers should fully investigate the practices, reputation and costs of working with a debt
settlement company before signing up.
Debt-to-Available-Credit Ratio: The amount of money you owe in outstanding debts compared to the total amount of credit you have
available though all credit cards and credit lines. This ratio measures how much of your available credit you are using. The higher your
debt to available credit ratio, the more risky you appear to potential lenders.
Debt-to-Income Ratio: The percentage of your monthly pre-tax income that is used to pay off debts such as auto loans, student loans
and credit card balances. Lenders look at two ratios: The front-end ratio is the percentage of monthly pre-tax earnings that are spent
on house payments. In the back-end ratio, the borrower’s other debts are factored in along with the house payments.
Default: The status of a debt account that has not been paid. Accounts are usually listed as being in default after they have been
reported late (delinquent) several times. Defaults are a serious negative item on a credit report.
Delinquency: A term used for late payment or lack of payment on a loan, debt or credit card account. Accounts are usually referred to
as 30, 60, 90 or 120 days delinquent because most lenders have monthly payment cycles. Delinquencies remain on your credit report
for 7 years and are damaging to your credit score.
Demand Draft Checks: A type of electronic check that can be created online by entering account numbers listed on the bottom of a
personal check and that can be cashed without a signature. This system was originally designed to help telemarketers take check
payments over the phone. Now it is one of the fastest growing fraud tools.
Dispute: The process of submitting a request to the credit bureaus to have an error on your credit report corrected. Disputes are
investigated and updates made to your credit report over a 30 day period. If your correction is made, you will receive a letter from the
credit bureaus and a copy of your updated credit report. If your dispute is rejected, you will receive a letter explaining why the credit
bureau could not verify the correction.
Divorce Decree: A court order that grants a divorce and outlines terms for child support, alimony and the separation of assets. While a
divorce decree may define responsibility for shared debts (your spouse pays the car loan, you pay the mortgage) it does not legally
separate responsibility for these accounts. In order to stop double responsibility and credit reporting of shared accounts, the debts
must be closed or refinanced directly with the lender.
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Empirica Score: A specific credit score developed by TransUnion. There are thousands of slightly different credit scoring formulas
used by bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit data. Click
here to check your credit score online .
Equal Credit Opportunity Act (ECOA): A law that protects consumers from discrimination on the basis of race, sex, public assistance
income, age, marital status, nationality or religion in the credit and lending process.
Equifax: One of the three national credit bureaus (also known as credit reporting agencies) that collects and provides consumer
financial records. You can purchase your credit report from Equifax online anytime .
Equity: The fair market value of a home minus the unpaid mortgage principal and liens. You build up equity in a home as you pay
down your mortgage and as the property value increases. Also called the lendable value or net value.
Experian: One of the three national credit bureaus that collects and provides consumer financial records. Experian (formerly known as
TRW) operates the ConsumerInfo, FreeCreditReport and CreditExpert brands. You can purchase your credit report form Experian
online anytime .
Expiration Term: The set number of years that a record will remain on your credit report as mandated by the FCRA. Most negative
records stay on your credit report for 7-10 years. The shortest expiration term is two years for inquiry records. The longest expiration
term is 15 years for paid tax liens or indefinitely for unpaid tax liens. Positive information can also stay on your credit report indefinitely.
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Fair and Accurate Credit Transaction (FACT) Act: The FACT Act was signed into law December 2003 and includes several consumer
credit industry regulations. This law requires credit bureaus to provide all US residents with a free copy of their credit report once
every 12 months. The law also includes new privacy regulations, identity theft protections and dispute procedure requirements.
Fair Credit Reporting Act (FCRA): A federal law first passed in the 1970’s that promotes accuracy, confidentiality and proper use of
information in the files kept by credit reporting agencies. This law specifies the expiration terms of records on your credit report,
defines who can access your credit data and grants consumers the right to view and dispute their credit records. You can review all
your rights under the FCRA online in our Learning Center.
Fannie Mae: The largest mortgage investor. A government-sponsored enterprise that buys mortgages from lenders, bundles them into
investments and sells them on the secondary mortgage market. Formerly known as the Federal National Mortgage
Association.
Federal Housing Administration (FHA): A division of the Department of Housing and Urban Development (HUD) that provides
mortgage insurance and sets construction and underwriting standards.
FICO Score: A specific credit score developed by Fair Isaac Corporation. There are thousands of slightly different credit scoring
formulas used by bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit
data. Click here to check your credit score online .
File Freeze: Residents of select states (currently California, Louisiana, Texas, Vermont and Washington) can request that the
credit bureaus freeze their credit reports. This freeze stops new credit from being issued in your name by blocking creditors,
lenders, insurers and other companies from accessing your credit data. In some cases, a $10 fee for each credit bureau is required
to process the file freeze. The freeze can also be temporarily or permanently undone for an additional fee.
Finance Charge: The total cost of using credit. Besides interest charges, the finance charge may include other costs such as cash-
advance fees.
First Mortgage: The primary loan on a real estate property. This loan has priority over all other “secondary” loans.
Fixed Rate: An interest rate for a credit card or loan that remains constant.
Fixed-Rate Option: A home equity line of credit financing option that allows borrowers to specify the payments and interest on a
portion of their balance. This can be done a few times during the life of the loan, usually for an additional fee.
Fixed Rate Mortgage (FRM): A mortgage with an interest rate that remains constant for the entire duration of the loan. FRM’s have
longer terms (15-30 years) and higher interest rates than adjustable rate mortgages but are not at risk for changing interest rates.
You can shop and compare mortgage options securely online.
Foreclosure: When a borrower is in default on a loan or mortgage, the creditor can enact a legal process to claim ownership of the
collateral property. Foreclosure usually involves a forced sale of the property where the proceeds go toward paying off the debt.
Fraud Alert: If you suspect that you are a victim of identity theft, you may contact the credit bureaus to request that a 90-day fraud
alert is placed on your credit reports. This alert notifies potential creditors to take extra steps to verify your identity before opening
a new account. If you have been a victim of identity theft you only need to contact one bureau to have a temporary 90 day alert
added to all three of your credit reports . This 90 day alert notifies potential creditors that your identity may have been stolen and
suggests that they take extra steps to confirm your identity before opening a new account. If it turns out that your identity has
been stolen, you can request an extended 7 year alert by providing documentation of the crime (such as a police report). There is
also a special 1 year fraud alert available for military personnel on activity duty.
Freddie Mac: Formerly known as the Federal Home Loan Mortgage Corporation, this is a government-sponsored firm that buys
mortgages from lenders, pools them with other loans and sells them to investors.
Front-End Ratio or Front Ratio: A calculation of the percentage of your monthly pre-tax income that goes toward a house
payment. The general rule is that your front ratio shouldn’t exceed 28%.
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Garnishment: When a creditor receives legal permission to take a portion of your assets (bank account, salary, etc) to repay a
delinquent debt.
Ginnie Mae: Also known as the Government National Mortgage Association. A part of the Department of Housing and Urban
Development that buys mortgages from lending institutions and pools them to form securities, which it then sells to investors.
Grace Period: A period of time, often about 25 days, during which you can pay your credit card bill without incurring a finance
charge. With most credit card accounts, the grace period applies only if you pay your balance in full each month. It does not apply
if you carry a balance forward or in the case of cash advances. If your account has no grace period, interest will be charged on a
purchase as soon as it is made. Compare credit cards offers online today .
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Hard Inquiry: A record of a business request to see your credit report data for the purpose of an application for credit. Hard
inquiries appear on your credit report each time you complete an application for a credit card, loan, cell phone, etc. Hard inquiries
can remain on your credit report for up to 2 years and can cause your credit score to drop slightly.
High-LTV Equity Loan: A specific kind of home loan that causes your loan-to-value ratio to be 125% or more. When the total
principal of a loan leaves the borrower with debt that exceeds the fair market value of the home, the interest paid on the portion of
the loan above that value may not be tax deductible.
Home Equity Line of Credit: An open-ended loan that is backed by the part of a home’s value that the borrower owns outright. This
type of loan is used much like a credit card. Home equity lines of credit can be effective ways to borrow large sums of money with
a relatively low interest rate. Apply for a home equity loan online. These types of loans should be used with caution. If a borrower
is unable to pay back the loan for some reason (loss of job, illness, etc.) they risk loosing the home they used as collateral.
Home Equity: The part of a home’s value that the mortgage borrower owns outright. This is the difference between the fair market
value of the home and the principal balances of all mortgage loans.
Home Ownership and Equity Protection Act: A law designed to discourage predatory lending in mortgages and home equity loans.
Housing Expense Ratio: The percentage of your monthly pre-tax income that goes toward your house payment. The general rule
is that this ratio shouldn’t exceed 28%. This is also known as the “front ratio.”
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Individual Taxpayer Identification Number (ITIN): This nine digit identification number is issued by the Internal Revenue Service to
taxpayers who don’t have a Social Security number, such as people who are not US citizens. This number can be used to apply
for credit and loans or to access credit reports.
Income Verification: Loan applications may require fully documented proof of an applicant’s income. Loans of this type usually
offer lower interest rates than no-income or “no-doc” verification loans.
Inquiry: An item on your credit report that shows that someone with a “permissible purpose” under FCRA regulations has
previously requested a copy of your credit report data. (See Soft Inquiry, Promotional Inquiry and Hard Inquiry).
Installment Account: A type of loan where the borrower makes the same payment each month. This includes personal loans and
automotive loans. Mortgage loans are also installment accounts but are usually classified by the credit reporting system as real-
estate accounts instead.
Interest Rate Cap: A limit on how much a borrower’s percentage rate can increase or decrease at rate adjustment periods and over
the life of the loan. Interest rate caps are used for ARM loans where the rates can vary at certain points.
Interest Rate: A measure of the cost of credit, expressed as a percent. For variable-rate credit card plans, the interest rate is
explicitly tied to another interest rate. The interest rate on fixed-rate credit card plans, though not explicitly tied to changes in other
interest rates, can also change over time.
Interest: The money a borrower pays for the ability to borrow from a lender or creditor. Interest is calculated as a percentage of the
money borrowed and is paid over a specified time.
Interest-Only Loan: A type of loan where the repayment only covers the interest that accumulates on the loan balance and not the
actual price of the property. The principal does not decrease with the payments. Interest-only loans usually have a term of 1-5
years.
Introductory Rate: A temporary, low interest rate offered on a credit card in order to attract customers. This low rate usually lasts
for about six months before converting to a normal fixed or variable rate. With some offers, the introductory rate can be revoked or
terminated early if you make a late payment or violate some other terms of the account. Shop for a credit card with a low
introductory rate online .
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Joint Account: An account shared by two or more people. Each person on the account is legally responsible for the debt and the
account will be reported to each person’s credit report.
Judgment: A decision from a judge on a civil action or lawsuit; usually an amount of money a person is required to pay to satisfy a
debt or as a penalty. Judgment records remain on your credit report for 7 years and harm your credit score significantly.
Jumbo Mortgage: A loan that exceeds the limits set by Fannie Mae and Freddie Mac (usually when the loan amount is more than
$200,000-400,000). Also known as a non-conventional or non-conforming loan, these mortgages usually have higher interest rates
than standard loans.
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Lease: An agreement where a dealer allows a consumer to use a car for a specific period in exchange for monthly payments. The
car can either be returned or purchased at the end of the lease term.
Lease extension: An agreement to extend the term of the initial lease with the same monthly payments.
Lease-like loan: Usually offered by credit unions, this loan acts much a like an auto lease. The loan has reduced monthly
payments, but does not include traditional due-on-signing lease fees. At the end of the loan term the car must be sold, refinanced,
or returned to the lender in order to pay off the remaining loan balance.
Manufacturer: A company that designs, produces, and markets vehicles. A manufacturer works with dealers to offer rebates,
marketing support, incentives, and financing programs to help sell its cars.
Mileage charge: A fee charged by a dealer if a leased car exceeds its annual mileage limits.
Monroney sticker: Named after the Oklahoma senator who wrote the Automobile Information Disclosure Act, this is the official
name for the sticker required to be placed on a car’s window when it is being sold by a dealer. The sticker shows the base price,
standard features, add-ons with their retail prices, fuel economy, delivery charges, and the manufacturer’s suggested retail price
(MSRP).
Mop and Glow: A dealer term for add-ons such as paint sealant that add to the price (and not really to the value) of a car posted for
sale.
MSRP: Acronym for Manufacturers Suggested Retail Price. This amount includes the price of the vehicle and add-ons.
Open-end lease: A type of vehicle lease program where the borrower must pay the difference between the residual value and the
market value of the car at the end of the lease term. This type of lease is less expensive than an open-end lease because the
borrower assumes more risk.
Rebate: A reduction in the price of a car set by the manufacturer in order to boost sales. Rebates are commonly used as a down
payment when financing the vehicle.
Repossession: When a loan is significantly overdue, a lender can claim ownership of the financed vehicle.
Residual value: The estimated value of a car when it is returned from a lease. The actual market value is subtracted from this
amount to calculate fees at the end of a lease term.
Rule of 78’s: An obscure and outdated formula that is still sometimes used by dealers to calculate a refund of finance charges
when a borrower pays back his or her loan early.
Title: Legal ownership of a specific car or property. Titles are documented with “deeds” stored in record offices.
Trade in value: The amount a dealer will pay you for an old car when you purchase a newer vehicle through its dealership. This
amount is usually lower than the wholesale value of the car.
Upside down: When the balance of a borrower´s loan exceeds the value of the car. This is common during the first year of an auto
loan/lease because the car depreciates rapidly. A borower can also be “upside down” in situations where a financed car has been
damaged.
Vehicle identification number: Also known as the “VIN number.” This is the unique identification number of a vehicle that appears
on the registration, title, and VIN plate on the car’s dashboard. You can use this number to look up a used car’s records.
Warranty: A dealer or manufacturer’s guarantee about a car’s performance. A warranty usually covers services and repairs for a
certain amount of time or mileage. KNOWLEDGE FINANCIAL GROUP AND WEALTH MANAGEMENT -
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1/1 ARM: An adjustable-rate mortgage that has a set initial interest rate for the first year. After that period, the mortgage rate adjusts
each year. Each annual rate adjustment is based on (or “indexed to”) another rate, often the yield on a U.S. Treasury note.
10/1 ARM: An adjustable-rate mortgage that has a set initial interest rate for the first 10 years. After that period, the mortgage rate
adjusts each year.
3/1 Interest-Only ARM: An adjustable rate mortgage in which none of the payments go toward paying off the loan principal for the first
three years.
3-in-1 Credit Report: Also called a merged credit report, this type of report includes your credit data from TransUnion, Equifax and
Experian in a side-by-side format for easy comparison. You can order your 3-in-1 Credit Report online anytime.
80-10-10 Loan: A combination of an 80% loan-to-value first mortgage, a 10% home equity loan and a 10% down payment. The loans
can be used to eliminate the need for private mortgage insurance.
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ACH: Automated Clearing House. This is a national network that allows for transferring funds electronically between businesses,
consumers and financial institutions.
Adjustable Rate Mortgage (ARM): A home loan where the interest rate is changed periodically based on a standard financial
index.
ARM’s offer lower initial interest rates with the risk of rates increasing in the future. In comparison, a fixed rate mortgage (FRM’s) offers
a higher rate that will not change for the length of the loan. ARMs often have caps on how much the interest rate can rise or fall. You
can shop and compare mortgage options securely online.
Alternative Mortgage: Any home loan that is not a standard fixed-rate mortgage. This includes ARM’s, reverse mortgages and jumbo
mortgages.
Alias: A note on your credit report that indicates other names used for your financial accounts. Sometimes marked as “Also Known
As” or “AKA.” This can include maiden names or variations on the spelling and format of your full name.
Amortization: The process of gradually repaying a debt with regularly scheduled payments.
AnnualCreditReport.com: The official website for obtaining your free credit report disclosures from the credit bureaus, Equifax,
Experian and TransUnion. You have the right to request your credit reports online, by phone or by mail for free once every 12 months
under FACT Act regulations. This free service can only be used once a year and does not include your credit scores or any credit
monitoring services.
Annual Fee: A charge sometimes required by credit card companies for use of an account. Annual fees range between $10-50 a year
and are most common with rewards cards or cards for subprime borrowers.
Annual Percentage Rate (APR): The interest rate being charged on a debt, expressed as a yearly rate. Credit cards often have
several
different APR’s - one for purchases, one for cash advances and one for balance transfers. Some lenders may increase the APR if a
payment is late.
Application Fee: Amount a lender charges to process loan application documents. Quality lenders do not charge these fees (though
they may charge many others).
Application Scoring: A specific kind of statistical scoring that businesses use to evaluate an applicant for acceptance or denial. Similar
to credit scoring, application scoring often factors in other relevant details such as employment status and income to determine risk.
Appraisal Fee: The amount charged to deliver a professional opinion about how much a property is worth. For a standard home or
condominium, this fee is usually around $200-500.
Appraised Value: An educated opinion of how much a property is worth. An appraiser considers the price of similar homes in the area,
the condition of the home and the features of the property to estimate the value. Request a free home value estimate .
Asset: Assets are things owned by a person that have cash value. This can include homes, cars, boats, savings and investments.
Authorized User: Anyone who uses your credit cards or credit accounts with your permission. More specifically, someone who has a
credit card from your account with their name on it. An authorized user is not legally responsible for the debt and will not get credit
score benefit from it. However, the account may appear on their credit report.
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Back-End Ratio or Back Ratio: The sum of your monthly mortgage payment and all other monthly debts (credit cards, car payments,
student loans, etc.) divided by your monthly pre-tax income. Traditionally, lenders wouldn’t give people loans that increased this ratio
past 36%, but they often do now. (See Debt-to-Income Ratio)
Balance Transfer: The process of moving all or part of the outstanding balance on one credit card to another account. Credit card
companies often offer special rates for balance transfers. Compare your credit card options online today .
Balloon Payment: A loan where the payments don’t pay off the principal in full by the end of the term. When the loan term expires
(usually after 5-7 years), the borrower must pay a balloon payment for the remaining amount or refinance. Balloon loans sometimes
include convertible options that allow the remaining amount to automatically be transferred into a long-term mortgage. (See
Convertible ARM)
Bankruptcy: A proceeding that legally releases a person from repaying a portion or all debts owed. Bankruptcy damages your credit
for 7-10 years and should only be considered as a last resort if you cannot repay your debts. (See Chapter 7-13 Bankruptcy)
Beacon Score: A specific credit score developed by Equifax. There are thousands of slightly different credit scoring formulas used by
bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit data. Check your
credit score online .
Bi-Weekly Mortgage: A mortgage that schedules payments every two weeks instead of the standard monthly payment. The 26 bi-
weekly payments are each equal to one-half of a monthly payment. The result is that the mortgage is paid off sooner.
Broker Premium: The amount a mortgage broker is paid for serving as the middleman between a lender and a borrower. This premium
comes from the surcharge a broker applies to a discounted loan before offering it to a borrower.
Borrower: The individual who is requesting the loan and who will be responsible to pay it back.
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Cardholder: The person who is issued a credit card and/or any authorized users.
Cash Advance: A cash loan requested from your creditor, usually through using your credit card at an ATM machine. Or a loan
advance on your paycheck. These loans include special interest rates charged on the amount of the advance.
Cash-Out Refinance: A new mortgage for an existing property in which the amount borrowed is greater than the amount of the
previous mortgage. The difference is given to the borrower in cash when the loan is closed.
Chapter 7 Bankruptcy: A type of consumer bankruptcy where your responsibility for your debts is cleared entirely. With this kind of
bankruptcy you are not required to pay back debts you owe from before your filing. Chapter 7 bankruptcy filing records remain on
your credit report for 10 years and the record of each account included in your filing will remain on your report for 7 years. This has
been the most common type of filing but changes to bankruptcy law will make it more difficult to file for Chapter 7 bankruptcy in the
future.
Chapter 11 Bankruptcy: A complex type of bankruptcy usually filed by businesses that wish to restructure their debts.
Chapter 12 Bankruptcy: A type of bankruptcy specifically for farmers and fishermen. Similar to Chapter 13 bankruptcy but with a few
special benefits.
Chapter 13 Bankruptcy: A type of bankruptcy where the consumer must pay off some of their debts over time. Chapter 13 bankruptcy
filing records remain on your credit report for 7 years from the discharge date or 10 years from the filing date if it is not discharged.
Each account included in the filing will remain on your report for 7 years.
Charge-Off: When a creditor or lender writes off the balance of a delinquent debt, no longer expecting it to be repaid. A charge-off is
also known as a bad debt. Charge-off records remain on your credit report for 7 years and will harm your credit score. After a debt is
charged-off, it can be sold to a collections agency.
ChexSystems: A credit reporting company that tracks your banking history and provides this data to banks when you apply for a new
checking account. Negative records, such as bounced checks, can be kept in their database for up to five years. If there are errors on
your ChexSystems record, you can contact the company to submit a dispute.
Closing Costs: The amounts charged to a consumer when they are transferring ownership or borrowing against a property. Closing
costs include lender, title and escrow fees and usually range from 3-6% of the purchase price.
Collateral: An asset or property used as security against a loan. (See Secured Credit Card)
Collections: When a business sells your debt for a reduced amount to an agency in order to recover the amounts owed. Credit card
debts, medical bills, cell phone bills, utility charges, library fees and video store fees are often sold to collections. Collection agencies
attempt to recover past-due debts by contacting the borrower via phone and mail. Collection records can remain on your credit report
for 7 years from the last 180 day late payment on the original debt. Your rights are defined by the Fair Debt Collection Practices Act .
Combined Loan-to-Value Ratio: The total amount you are borrowing in mortgage debts divided by the home’s fair market value.
Someone with a $50,000 first mortgage and a $20,000 equity line secured against a $100,000 house would have a CLTV ratio of 70%.
Commitment Fee: A fee paid by a borrower to a lender in exchange for a promise to lend money on certain terms for a specified period.
Usually charged in order to extend a loan approval offer for longer than the 30-60 day standard period. Quality lenders don’t usually
charge these fees.
Conforming Loan: A mortgage that meets the requirements for purchase by Fannie Mae and Freddie Mac. Requirements include size
of the loan, type and age. Current loan size limits for single-family homes range between $200,000 and $400,000. Loans that exceed
the conforming size are considered jumbo mortgages and usually have higher interest rates.
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Co-Signer: An additional person who signs a loan document and takes equal responsibility for the debt. A borrower may want to use a
co-signer if their credit or financial situation is not good enough to qualify for a loan on their own. A co-signer is legally responsible for
the loan and the shared account will appear on their credit report. Having a co-signer is only helpful if the co-signer’s credit or financial
standing is better than the primary lender.
Convenience Check: Checks provided by your credit card company that you can use to access your available credit. These checks
often have different rates and terms than your standard credit card charges.
Convertible ARM: An adjustable rate mortgage that can be converted to a fixed-rate mortgage under specified conditions.
Credit Bureaus: Also known as credit reporting agencies, these companies collect information from creditors and lenders about
consumer financial behavior. This data is then provided to businesses that want to evaluate how risky it would be to lend money to a
potential borrower. Once a low-tech system of regional credit reporting agencies, the industry is now consolidated into the three
national credit bureaus - Equifax, Experian and TransUnion. FICO is not a credit bureau; instead they are company that develops
credit scoring formulas. Click here to order your credit reports from all three bureaus online .
Credit Counseling: A service that helps consumers repay their debts and improve their credit. Usually non-profit companies, most of
these agencies offer helpful and affordable services. Consumers should be aware that there are also credit counseling agencies that
are expensive, ineffective and even damaging to the client’s credit (see Credit Repair). Consumers should carefully review the
company’s reputation and services before signing up.
Credit File: Another term for your credit report . The term credit file is usually used to indicate the full record of your credit history
maintained by a credit bureau. Your credit report may not include all the information in your credit file.
Credit History: Another term for the information on your credit report. Your credit history is a record of how you have has repaid your
credit obligations in the past.
Credit Limit: The total amount that a company will allow you to charge to a credit card or credit line. It’s best for your credit score to
keep your credit card balances below 35% of your credit limit. If you spend more than your credit limit, you will be charged an
“overage fee” of about $10-50.
Credit Obligation: An agreement where a person becomes legally responsible for paying back borrowed money.
Credit Repair: A generally unscrupulous or illegal form of credit counseling that promises the impossible, such as erasing accurate
records from your credit report.
Credit Report: The individual records of consumer financial behavior kept by credit bureaus and provided to businesses when they
want to evaluate potential borrowers. Credit reports include records on: consumer name, current and former addresses, employment,
credit and loan histories, inquiries, collection records, and public records such as bankruptcy filings and tax liens. You can purchase
your credit reports online anytime .
Credit Score: A numerical evaluation of your credit history used by businesses to quickly understand how risky a borrower you are.
Credit scores are calculated using complex mathematical formulas that look at your most current payment history, debts, credit
history, inquiries and other factors from your credit report. Credit scores usually range from 300-850, with 680 or higher considered to
be “good” credit scores. There are thousands of slightly different credit scoring formulas (including FICO, Beacon and Empirca
scores) used by bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit data.
Click here to check your credit score online .
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Debt: The amount of money owed.
Debt Consolidation: A process of combining debts into one loan or repayment plan. Debt consolidation can be done on your own,
with a financial institution or through a counseling service. Student loans are often consolidated in order to secure a lower interest
rate. (See Debt Counseling and Debt Settlement)
Debt Counseling: A type of credit counseling that focuses specifically on helping people with debt issues. Instead of consolidating
debts into one loan, debt counseling agencies negotiate with your creditors using pre-set agreements and spread your payments over
a longer period in order to reduce the monthly amount due. Usually non-profit companies, most of these agencies offer helpful and
affordable services. Consumers should be aware that there are also debt counseling agencies that are expensive, ineffective and even
damaging to the client’s credit score (see Credit Repair).
Debt Settlement: A process where you pay an agency to negotiate directly with your creditors in the hopes of making significantly
reduced settlements for your debts. Working with a debt settlement company can result in damaged credit from numerous late
payments and collection records. Consumers should fully investigate the practices, reputation and costs of working with a debt
settlement company before signing up.
Debt-to-Available-Credit Ratio: The amount of money you owe in outstanding debts compared to the total amount of credit you have
available though all credit cards and credit lines. This ratio measures how much of your available credit you are using. The higher your
debt to available credit ratio, the more risky you appear to potential lenders.
Debt-to-Income Ratio: The percentage of your monthly pre-tax income that is used to pay off debts such as auto loans, student loans
and credit card balances. Lenders look at two ratios: The front-end ratio is the percentage of monthly pre-tax earnings that are spent
on house payments. In the back-end ratio, the borrower’s other debts are factored in along with the house payments.
Default: The status of a debt account that has not been paid. Accounts are usually listed as being in default after they have been
reported late (delinquent) several times. Defaults are a serious negative item on a credit report.
Delinquency: A term used for late payment or lack of payment on a loan, debt or credit card account. Accounts are usually referred to
as 30, 60, 90 or 120 days delinquent because most lenders have monthly payment cycles. Delinquencies remain on your credit report
for 7 years and are damaging to your credit score.
Demand Draft Checks: A type of electronic check that can be created online by entering account numbers listed on the bottom of a
personal check and that can be cashed without a signature. This system was originally designed to help telemarketers take check
payments over the phone. Now it is one of the fastest growing fraud tools.
Dispute: The process of submitting a request to the credit bureaus to have an error on your credit report corrected. Disputes are
investigated and updates made to your credit report over a 30 day period. If your correction is made, you will receive a letter from the
credit bureaus and a copy of your updated credit report. If your dispute is rejected, you will receive a letter explaining why the credit
bureau could not verify the correction.
Divorce Decree: A court order that grants a divorce and outlines terms for child support, alimony and the separation of assets. While a
divorce decree may define responsibility for shared debts (your spouse pays the car loan, you pay the mortgage) it does not legally
separate responsibility for these accounts. In order to stop double responsibility and credit reporting of shared accounts, the debts
must be closed or refinanced directly with the lender.
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Empirica Score: A specific credit score developed by TransUnion. There are thousands of slightly different credit scoring formulas
used by bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit data. Click
here to check your credit score online .
Equal Credit Opportunity Act (ECOA): A law that protects consumers from discrimination on the basis of race, sex, public assistance
income, age, marital status, nationality or religion in the credit and lending process.
Equifax: One of the three national credit bureaus (also known as credit reporting agencies) that collects and provides consumer
financial records. You can purchase your credit report from Equifax online anytime .
Equity: The fair market value of a home minus the unpaid mortgage principal and liens. You build up equity in a home as you pay
down your mortgage and as the property value increases. Also called the lendable value or net value.
Experian: One of the three national credit bureaus that collects and provides consumer financial records. Experian (formerly known as
TRW) operates the ConsumerInfo, FreeCreditReport and CreditExpert brands. You can purchase your credit report form Experian
online anytime .
Expiration Term: The set number of years that a record will remain on your credit report as mandated by the FCRA. Most negative
records stay on your credit report for 7-10 years. The shortest expiration term is two years for inquiry records. The longest expiration
term is 15 years for paid tax liens or indefinitely for unpaid tax liens. Positive information can also stay on your credit report indefinitely.
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Fair and Accurate Credit Transaction (FACT) Act: The FACT Act was signed into law December 2003 and includes several consumer
credit industry regulations. This law requires credit bureaus to provide all US residents with a free copy of their credit report once
every 12 months. The law also includes new privacy regulations, identity theft protections and dispute procedure requirements.
Fair Credit Reporting Act (FCRA): A federal law first passed in the 1970’s that promotes accuracy, confidentiality and proper use of
information in the files kept by credit reporting agencies. This law specifies the expiration terms of records on your credit report,
defines who can access your credit data and grants consumers the right to view and dispute their credit records. You can review all
your rights under the FCRA online in our Learning Center.
Fannie Mae: The largest mortgage investor. A government-sponsored enterprise that buys mortgages from lenders, bundles them into
investments and sells them on the secondary mortgage market. Formerly known as the Federal National Mortgage
Association.
Federal Housing Administration (FHA): A division of the Department of Housing and Urban Development (HUD) that provides
mortgage insurance and sets construction and underwriting standards.
FICO Score: A specific credit score developed by Fair Isaac Corporation. There are thousands of slightly different credit scoring
formulas used by bankers, lenders, creditors, insurers and retailers. Each score can vary somewhat in how it evaluates your credit
data. Click here to check your credit score online .
File Freeze: Residents of select states (currently California, Louisiana, Texas, Vermont and Washington) can request that the
credit bureaus freeze their credit reports. This freeze stops new credit from being issued in your name by blocking creditors,
lenders, insurers and other companies from accessing your credit data. In some cases, a $10 fee for each credit bureau is required
to process the file freeze. The freeze can also be temporarily or permanently undone for an additional fee.
Finance Charge: The total cost of using credit. Besides interest charges, the finance charge may include other costs such as cash-
advance fees.
First Mortgage: The primary loan on a real estate property. This loan has priority over all other “secondary” loans.
Fixed Rate: An interest rate for a credit card or loan that remains constant.
Fixed-Rate Option: A home equity line of credit financing option that allows borrowers to specify the payments and interest on a
portion of their balance. This can be done a few times during the life of the loan, usually for an additional fee.
Fixed Rate Mortgage (FRM): A mortgage with an interest rate that remains constant for the entire duration of the loan. FRM’s have
longer terms (15-30 years) and higher interest rates than adjustable rate mortgages but are not at risk for changing interest rates.
You can shop and compare mortgage options securely online.
Foreclosure: When a borrower is in default on a loan or mortgage, the creditor can enact a legal process to claim ownership of the
collateral property. Foreclosure usually involves a forced sale of the property where the proceeds go toward paying off the debt.
Fraud Alert: If you suspect that you are a victim of identity theft, you may contact the credit bureaus to request that a 90-day fraud
alert is placed on your credit reports. This alert notifies potential creditors to take extra steps to verify your identity before opening
a new account. If you have been a victim of identity theft you only need to contact one bureau to have a temporary 90 day alert
added to all three of your credit reports . This 90 day alert notifies potential creditors that your identity may have been stolen and
suggests that they take extra steps to confirm your identity before opening a new account. If it turns out that your identity has
been stolen, you can request an extended 7 year alert by providing documentation of the crime (such as a police report). There is
also a special 1 year fraud alert available for military personnel on activity duty.
Freddie Mac: Formerly known as the Federal Home Loan Mortgage Corporation, this is a government-sponsored firm that buys
mortgages from lenders, pools them with other loans and sells them to investors.
Front-End Ratio or Front Ratio: A calculation of the percentage of your monthly pre-tax income that goes toward a house
payment. The general rule is that your front ratio shouldn’t exceed 28%.
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Garnishment: When a creditor receives legal permission to take a portion of your assets (bank account, salary, etc) to repay a
delinquent debt.
Ginnie Mae: Also known as the Government National Mortgage Association. A part of the Department of Housing and Urban
Development that buys mortgages from lending institutions and pools them to form securities, which it then sells to investors.
Grace Period: A period of time, often about 25 days, during which you can pay your credit card bill without incurring a finance
charge. With most credit card accounts, the grace period applies only if you pay your balance in full each month. It does not apply
if you carry a balance forward or in the case of cash advances. If your account has no grace period, interest will be charged on a
purchase as soon as it is made. Compare credit cards offers online today .
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Hard Inquiry: A record of a business request to see your credit report data for the purpose of an application for credit. Hard
inquiries appear on your credit report each time you complete an application for a credit card, loan, cell phone, etc. Hard inquiries
can remain on your credit report for up to 2 years and can cause your credit score to drop slightly.
High-LTV Equity Loan: A specific kind of home loan that causes your loan-to-value ratio to be 125% or more. When the total
principal of a loan leaves the borrower with debt that exceeds the fair market value of the home, the interest paid on the portion of
the loan above that value may not be tax deductible.
Home Equity Line of Credit: An open-ended loan that is backed by the part of a home’s value that the borrower owns outright. This
type of loan is used much like a credit card. Home equity lines of credit can be effective ways to borrow large sums of money with
a relatively low interest rate. Apply for a home equity loan online. These types of loans should be used with caution. If a borrower
is unable to pay back the loan for some reason (loss of job, illness, etc.) they risk loosing the home they used as collateral.
Home Equity: The part of a home’s value that the mortgage borrower owns outright. This is the difference between the fair market
value of the home and the principal balances of all mortgage loans.
Home Ownership and Equity Protection Act: A law designed to discourage predatory lending in mortgages and home equity loans.
Housing Expense Ratio: The percentage of your monthly pre-tax income that goes toward your house payment. The general rule
is that this ratio shouldn’t exceed 28%. This is also known as the “front ratio.”
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Individual Taxpayer Identification Number (ITIN): This nine digit identification number is issued by the Internal Revenue Service to
taxpayers who don’t have a Social Security number, such as people who are not US citizens. This number can be used to apply
for credit and loans or to access credit reports.
Income Verification: Loan applications may require fully documented proof of an applicant’s income. Loans of this type usually
offer lower interest rates than no-income or “no-doc” verification loans.
Inquiry: An item on your credit report that shows that someone with a “permissible purpose” under FCRA regulations has
previously requested a copy of your credit report data. (See Soft Inquiry, Promotional Inquiry and Hard Inquiry).
Installment Account: A type of loan where the borrower makes the same payment each month. This includes personal loans and
automotive loans. Mortgage loans are also installment accounts but are usually classified by the credit reporting system as real-
estate accounts instead.
Interest Rate Cap: A limit on how much a borrower’s percentage rate can increase or decrease at rate adjustment periods and over
the life of the loan. Interest rate caps are used for ARM loans where the rates can vary at certain points.
Interest Rate: A measure of the cost of credit, expressed as a percent. For variable-rate credit card plans, the interest rate is
explicitly tied to another interest rate. The interest rate on fixed-rate credit card plans, though not explicitly tied to changes in other
interest rates, can also change over time.
Interest: The money a borrower pays for the ability to borrow from a lender or creditor. Interest is calculated as a percentage of the
money borrowed and is paid over a specified time.
Interest-Only Loan: A type of loan where the repayment only covers the interest that accumulates on the loan balance and not the
actual price of the property. The principal does not decrease with the payments. Interest-only loans usually have a term of 1-5
years.
Introductory Rate: A temporary, low interest rate offered on a credit card in order to attract customers. This low rate usually lasts
for about six months before converting to a normal fixed or variable rate. With some offers, the introductory rate can be revoked or
terminated early if you make a late payment or violate some other terms of the account. Shop for a credit card with a low
introductory rate online .
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Joint Account: An account shared by two or more people. Each person on the account is legally responsible for the debt and the
account will be reported to each person’s credit report.
Judgment: A decision from a judge on a civil action or lawsuit; usually an amount of money a person is required to pay to satisfy a
debt or as a penalty. Judgment records remain on your credit report for 7 years and harm your credit score significantly.
Jumbo Mortgage: A loan that exceeds the limits set by Fannie Mae and Freddie Mac (usually when the loan amount is more than
$200,000-400,000). Also known as a non-conventional or non-conforming loan, these mortgages usually have higher interest rates
than standard loans.
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Lease: An agreement where a dealer allows a consumer to use a car for a specific period in exchange for monthly payments. The
car can either be returned or purchased at the end of the lease term.
Lease extension: An agreement to extend the term of the initial lease with the same monthly payments.
Lease-like loan: Usually offered by credit unions, this loan acts much a like an auto lease. The loan has reduced monthly
payments, but does not include traditional due-on-signing lease fees. At the end of the loan term the car must be sold, refinanced,
or returned to the lender in order to pay off the remaining loan balance.
Manufacturer: A company that designs, produces, and markets vehicles. A manufacturer works with dealers to offer rebates,
marketing support, incentives, and financing programs to help sell its cars.
Mileage charge: A fee charged by a dealer if a leased car exceeds its annual mileage limits.
Monroney sticker: Named after the Oklahoma senator who wrote the Automobile Information Disclosure Act, this is the official
name for the sticker required to be placed on a car’s window when it is being sold by a dealer. The sticker shows the base price,
standard features, add-ons with their retail prices, fuel economy, delivery charges, and the manufacturer’s suggested retail price
(MSRP).
Mop and Glow: A dealer term for add-ons such as paint sealant that add to the price (and not really to the value) of a car posted for
sale.
MSRP: Acronym for Manufacturers Suggested Retail Price. This amount includes the price of the vehicle and add-ons.
Open-end lease: A type of vehicle lease program where the borrower must pay the difference between the residual value and the
market value of the car at the end of the lease term. This type of lease is less expensive than an open-end lease because the
borrower assumes more risk.
Rebate: A reduction in the price of a car set by the manufacturer in order to boost sales. Rebates are commonly used as a down
payment when financing the vehicle.
Repossession: When a loan is significantly overdue, a lender can claim ownership of the financed vehicle.
Residual value: The estimated value of a car when it is returned from a lease. The actual market value is subtracted from this
amount to calculate fees at the end of a lease term.
Rule of 78’s: An obscure and outdated formula that is still sometimes used by dealers to calculate a refund of finance charges
when a borrower pays back his or her loan early.
Title: Legal ownership of a specific car or property. Titles are documented with “deeds” stored in record offices.
Trade in value: The amount a dealer will pay you for an old car when you purchase a newer vehicle through its dealership. This
amount is usually lower than the wholesale value of the car.
Upside down: When the balance of a borrower´s loan exceeds the value of the car. This is common during the first year of an auto
loan/lease because the car depreciates rapidly. A borower can also be “upside down” in situations where a financed car has been
damaged.
Vehicle identification number: Also known as the “VIN number.” This is the unique identification number of a vehicle that appears
on the registration, title, and VIN plate on the car’s dashboard. You can use this number to look up a used car’s records.
Warranty: A dealer or manufacturer’s guarantee about a car’s performance. A warranty usually covers services and repairs for a
certain amount of time or mileage. KNOWLEDGE FINANCIAL GROUP AND WEALTH MANAGEMENT -
KNOWLEDGEFINANCIALGROUP.COM
Remember: Real
estate also has
3 T's TO DEAL
WITH... #1. TOILET -
#2. TENANTS AND
FINALLY
#3. TRASH
estate also has
3 T's TO DEAL
WITH... #1. TOILET -
#2. TENANTS AND
FINALLY
#3. TRASH