What does it mean? A co-signer is an individual who cooperatively signs the loan with the borrower and becomes the secondary repayment source. The co-signers facilitate the borrower in obtaining loans that they may not have been able to qualify for. Borrowers can negotiate for receiving a greater principal amount if they have individuals who …
Post Type Archives: Glossary
Collateral
What does it mean? Collateral is an asset that you can pledge as security for a loan. If you fail to repay the loan, the lender has the right to sell the collateral to claim the dues. You can get a home loan, a gold loan, a business loan, a loan against FD and a …
Compensation
This is the total payment received in exchange for a service as well as a reward for outstanding performance. It is usually used in reference to a person’s salary or wages. Compensation includes the following: Basic pay Dearness allowance House rent allowance Leave travel allowance Overtime pay Bonus Perks, incentives, or commission Stock options or …
Compounding
Compounding refers to the ability of money to increase exponentially over time by the repetitive additions of earnings to the principal amount. This happens because the interest amount is not withdrawn. Instead, it gets reinvested to earn additional returns. A higher compounding period leads to a higher compound interest. Here is an example for better …
Consolidate
To consolidate means to merge assets, liabilities or other financial entities into one. It also refers to consolidating the financial statements of a company. It helps companies display their cumulative assets, revenue or expenses and report them under the financial statements of one parent organisation. Consolidation is also a term that is used when the …