It stands for Annual Percentage Rate . It refers to the percentage rate of interest to be charged on the loan. It refers to the interest rate for the whole year. APR is fixed before the loan is approved. A nominal APR is a simple interest rate. APR is regarded as the tool to compare various loan products in the UK finance segment. Bankruptcy is the situation which states your inability to pay your creditors. It is a stage when your outstanding financial obligations exceed your total capacity to pay-back the debts. In the case of bankruptcy, your assets are used to raise the funds to repay your creditors Credit score refers to your credit reputation in the market. It shows how you have handled your past creditors. If you paid all your debt on the regular basis without any problem, your credit score will be good enough to get you loan in future. Credit score turns out to be an excellent parameter for the lenders to judge a particular loan applicant since, they always want to ensure that their money is going into safe hands. Needless to say a good credit score means that you will face no problem in future whenever you want to raise money. It is also used for opening a new bank account. If you do not have the required credit score your application to open the bank account may get cancelled. Credit score is a significant aspect of one's credit profile hence, any kind of discrepancy (on agency or your behalf) or even a controversy can tarnish your image thus, creating major problems for you in near future. Creditors are those financial institutions or the people who provide us with the financial help. Creditors provide us with required liquidity (cash) on a fixed rate of interest. Debt collection is a method to collect the debts. A debt collection agency works as an agent of creditors and collect the debts for a fee or by charging a percentage of total amount owed. Thus, this refers to a company or an organization that works to collect the money you owe to the other firm or people, in other words creditors. Debt consolidation is a technique which enables an individual to repay all his debts by taking a loan. This loan covers all or few existing debts of the borrower. Borrower starts making a single payment each month instead of paying separately for each debt. The repayment tenure is fixed according to your financial condition. Debtor is the person who borrows the money from the creditors. They owe the interest on the money extended by the creditor in addition to the principal amount. They have the obligation to repay the money with interest on time to the creditors. IVA stands for individual Voluntary Arrangement. This is assumed the best alternative to bankruptcy for an individual. It is an arrangement with the creditors to solve the debt problem of the individual. Under this agreement a borrower has to pay an agreed amount that is fixed according to the financial condition of that person. The term and condition can be changed in future. Assets can be defined as a property or a valuable thing that an individual owns in his name and has the authority to pledge it. Usually, assets are pledged by the borrower with the lender as a security against the amount that they seek to procure as loan. These are used in case of secured loan products. In case of a CCJ if borrower does not pay for his / her debt which is fixed by the court. The court gives a notice to the employer asking to deduct the agreed amount before paying out his wages. This deducted amount is then used to repay the debts. CCJ stands for Country Court Judgement. It is a legal notice that is sent to the person unable to pay-back the outstanding amount to his creditors who in turn seek the shelter in form of legal help. All the conditions are analysed by the court and than a monthly amount is fixed which is to be paid by the borrower. In most of the cases, the interest factor takes a backseat and the court asks the borrower to repay a certain fixed amount. Remember, CCJ leave a negative impact on your credit history. Credit reference agencies hold information about your present credit agreements. A lender can get the information about your credit score from these agencies. These agencies provide the information about how you are handling the debts. Remember, your credit history is judged on the basis of the information provided by these agencies. Hence, it is your duty to make sure that all the data relating to you with the agency is correct so that you do not face any problem in future. Debtor is the person who borrows the money from the creditors. They owe the interest on the money extended by the creditor in addition to the principal amount. They have the obligation to repay the money with interest on time to the creditors. Equity refers to the sum total of assets which a person has its own. It is the monetary value of your real assets. In real estate segment, the owner's equity in a property is the difference between the market price of a property and the financial obligations against the property (e.g. mortgage debt). Insolvency is that situation in which a borrower finds himself unable to repay his debts. Secured loans are the loans which are secured by the collateral placed by the borrower as a security against the amount of loan with the lender. The rate of interest with these loans is generally less than what is there with unsecured loans. This is Scottish court's term for bankruptcy. The conditions are more or less same. If the borrower is not able to repay the amount of the lender then borrower's assets are confiscated on behalf of his creditors. Trust deed is a healthy practice through which an agreement is made between you and your creditors. After this agreement you will have to pay a lower and fixed monthly payment for a fixed period of time, normally for a period of three years. As soon as the trust deed is completed, all the remaining debt is written-off. A deed of trust has three parties:- 1.The borrower. 2.The trustee or the agency that is arranging all the things. 3.The lender These types of loans are not supported by any security. They are taken without pledging any asset against the loan. In these types of loans risk is very high for the lender. These loans are provided after considering the credit score of the borrower.


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