Definition of Credit

Old Definition of Credit

Surprisingly enough most of the naming conventions connected with modern accounting comes from from the Latin or Greek languages.  The term, “credit” for example comes from ‘Credo,’ a Latin word that means “I Believe!” It gradually evolved as a word that meant “trust” involving finances. Back in ancient times, the lending and borrowing game was played by word of mouth with no written contracts.  Back then, credit didn’t involve cash but rather the bartering of goods and services.  Nowadays, the word “credit” has worked its way up into the field of financial transactions.

New Definition of Credit

Lawyers got into the act and created legal agreements and contracts between parties in writing and of course used very long and confusing terms along with wording not normally understood by the average man. But no problem, you could always “hire” a lawyer to decipher them to no one’s surprise.  The financial definition of credit is now used as a word for delayed payment.  An institution such as a bank gives money to the buyer and waits for a specific time period to receive the payment. The total amount owed is called ‘debt.’ The person or business lending the money is called the creditor or sometimes they are called the lender, who then offers credit to the borrower, or debtor.

The amount of money received by the borrower is called a “loan” and if it is for personal purposes such as taking care of health, family, education, or any other personal purpose the process is known as consumer credit, consumer lending, or just retail lending.

Auto Loan Advice : How to Get a Cheap Car Loan !

You May Also Like

Extending Your Loan Term? Choice Smart Car Loan Refinancing

Extending Your Loan Term? Choice Smart Car Loan Refinancing

Re-financing your car loan involves getting a brand-new car loan to pay off an existing automobile funding. This action might possibly result in securing reduced rate of interest or much better terms on the lending which can conserve you hundreds of dollars in time. Moreover, refinancing permits consolidating financial obligation boosting credit history and minimizing month-to-month settlements.

Can You Negotiate an Interest Rate for a Car Loan?

Can You Negotiate an Interest Rate for a Car Loan?

Many may believe that interest rates are fixed; however, in reality they can often be negotiable. We will explore this option of negotiating interest rates for car loans here and provide answers to frequently asked questions as well.