Glossary

Annual Percentage Rate – The total finance charge shown as a percentage of the amount financed.

Collateral – Personal property that's pledged as a guarantee that you will repay your loan.

Equity – It is the difference between the current value and the outstanding liens (the legal right to hold property of another party) on a property.

Interest Rate – The cost of borrowing money shown as a percentage over a one-year period.

Mortgage – A property pledge that is used as security or collateral for the repayment of a loan.

Payment Protection Insurance – Insurance that repays outstanding debt on a mortgage if the borrower cannot pay due to reasons such as ill-health, unemployment, or death.