Glossary

Adverse Credit
1) Credit not paid or not paid when agreed. 2) If someone has adverse credit they have not kept up with credit agreements that they are contracted to. Examples of Adverse Credit include; County Court Judgments (CCJ's), mortgage arrears, and payment defaults.

Application
Information provided by a consumer disclosing their personal details and information about their current financial situation. This information is used by us to make an informed assessment.

APR
This means the 'Annual Percentage Rate' and tells you the rate of interest that will be charged on your loan taking into account the total cost of interest and other charges e.g. legal fees.

Arrears
Payments not made by a borrower on time. This is usually described in terms of money or missed payments.

Bad Credit
Used to describe a poor credit rating. This happens when borrowers fail to make loan or other repayments or make them late, borrow more than they can afford to repay, are/have been declared bankrupt, or have CCJ's against their names.

Bankruptcy
A legal status for those who are not able to repay their debts.

Broker
Brokers are intermediaries who arrange both secured and unsecured loans for applicants with various lenders. Brokers may have a panel of different lenders with which they can place the applicant's loan, or they may be tied to a particular lender. DBS Finance has an extensive panel of lenders, each of whom offers a comprehensive range of loans; this ensures that whatever your circumstances we can find the best loan for you.

Budget Calculator
A form to help you work out your incomings and outgoings, and work out how much you need to borrow, and can afford to pay back.

CCJ or CCJ's
County Court Judgement. An order of a court against a debtor to pay money owed.

Collateral
Security or Equity.

Commercial Loan / Business Loan
A loan used for business purposes.

Commission
A percentage of a loan which a broker might receive for placing a loan with a lender.

Consolidation / Debt Consolidation
Refinance of outstanding debts into one new agreement, normally at a reduced interest rate or lower monthly repayment.

Credit
Credit is the means by which consumers can get immediate benefit of goods or services upon the promise of payment at a future date.

Credit Agreement
A contract between a borrower and a lender detailing terms and conditions under which money was lent. This is a legally binding document.

Credit Reference Agency
Companies used by loan brokers/providers to make assessments on individuals wishing to borrow from them. They keep records on the existing credit of businesses and consumers.

Debt
Money owed to a lender or financial institution.

Defaults
When an individual fails to keep up with loan or mortgage payments that they have agreed to pay they are said to have defaulted.

Fixed Interest Rate
The type of interest rate that is fixed for a period of time. The rate may be fixed for an initial period or the entire term of the loan. If the rate is fixed for a specified term, after this term the rate will usually revert to the lender's standard variable rate.

Freeholder
When someone owns land or property outright. Property deeds will identify whether a property is held on a leasehold or freehold basis.

Home owner
The term used when the customer has purchased their home, normally with the aid of a mortgage.

IFA
Independent Financial Advisor.

Leasehold
A Leaseholder holds the title to land/property for a predetermined amount of time.

Lender
The company that provides you with your loan/mortgage.

LTV
Loan to value, this is the size of the loan or mortgage as a percentage of the value of the property or price being paid for the property e.g. A property valued at £100,000 with a mortgage of £90,000 would have an LTV of 90%.

Loan Broker
An intermediary who identifies, and places, customers requiring a loan or mortgage with a Lender able to provide it. The broker often carries out the administration to do with processing the loan.

Loan Calculator
A device we have developed to help you work out what your loan repayments might be.

Loan Purpose
The reason why someone would want to borrow money. E.g. To pay for a new car.

Mortgage
A loan to purchase a home where the property is used as security in the event of non-payment of the mortgage.

Negative Equity
The situation where the amount owed on a mortgage is more than the value of the property.

Non Status
Where you have numerous CCJ's or Mortgage Arrears.

Past Arrears
Payments not made on borrowing when agreed that have occurred in the past, normally within the last 12 months.

Payment Protection Insurance
Insurance which can be taken with a loan to help borrowers to make loan repayments in the event of redundancy, illness or disability.

Redemption Penalties
When a loan is redeemed (paid off) early, either in full or in part, many lenders will charge a fee. The actual amount charged or the way in which it is calculated will be detailed on your Credit Agreement.

Secured Loan
A loan that needs to be secured on assets, e.g. cars, houses etc. These assets will be at risk if the borrower does not keep up loan repayments as agreed.

Security
Security is an item of value that is pledged by the borrower to the lender as part of the terms and conditions of a loan. As a last resort, in the event that a borrower does not make the agreed repayments a lender may sell the asset to recover their money.

Settlement Figure
The amount needed to repay the loan during the contracted term.

Tenant
A person who does not own a home, but instead pays rent to a landlord. This includes people living with their parents.

Underwriting
The process by which a potential lender or broker determines the suitability of an applicant for the loan they have requested. The main consideration is the ability of the applicant to repay the loan they have requested.

Unsecured Loan
A loan that does not require any security. This may be because the borrower has a good financial position or credit rating. Such borrowers may be classed as 'Clean'.