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Top Terminologies in Periodic Loan Statements to Understand Your Financial Transactions

You're not alone! Understanding the key terms is crucial for managing your finances effectively.

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Top Terminologies in Periodic Loan Statements to Understand Your Financial Transactions

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  1. Top Terminologies in Periodic Loan Statements to Understand Your Financial Transactions

  2. Feeling lost with your loan statement? You're not alone! Understanding the key terms is crucial for managing your finances effectively. To cut down on the jargon, here are the top terminologies in your loan statement presented to you in a simplified manner.

  3. 01 AMORTIZATION SCHEDULE Breaks down your loan payments over time, showing the amount that goes towards interest and the amount that goes towards the principal.

  4. 02 INTEREST CHARGED The fee you pay for borrowing the money, typically shown as a monthly amount.

  5. 03 DEFAULT If you are unable to make your loan payments and the deadline for the payment has also gone by, it is characterized as default. This can lead to serious consequences. Understanding this term motivates timely payments.

  6. 04 ESCROW In a mortgage, your lender creates an escrow account that holds part of your monthly payment to pay your property taxes and homeowners insurance on your behalf. This ensures timely payments and protects both you and the lender.

  7. 05 LOAN TERM The total length of time you have to repay your loan.

  8. 06 MINIMUM PAYMENT DUE The smallest amount you need to pay to avoid late fees, but paying more can save you money in the long run.

  9. 07 NEW BALANCE What you still owe on the loan after your latest payment and interest are applied.

  10. 08 PAYMENTS RECEIVED The total amount you've paid towards the loan during a specific period.

  11. 09 PREVIOUS BALANCE The amount you owed on the loan before your latest payment.

  12. 10 STATEMENT DATE The date your loan statement is issued, showing your recent activity.

  13. www.brytsoftware.com An Automated Loan Management Solution That Monitors your Loans For You.

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