Glossary of Credit Terms:
Balance – total debt you owe for all open and closed accounts on your credit report.
Balance transfer – moving a balance from one account to another.
Charge-off – the balance on a credit obligation that a lender no longer expects to be repaid and writes off a bad debt.
Collection – when a past-due credit obligation is sent to a collection agency.
Credit availability – the amount of credit you have remaining on your credit account.
Credit history – record of how someone has borrowed and paid debt.
Default – failure to make a loan or debt payment when due. An account is typically considered to be in default after being delinquent for several consecutive 30-day billing cycles.
Delinquent – an account that is currently past due for the minimum required payment. Accounts are usually referred to as 30, 60, 90 or 120 days delinquent.
Derogatory – the number of accounts on your credit report that are negatively impacting your credit score.
Installment debt – debt to be paid at regular intervals over a specified period (mortgage and auto loans).