Getting a loan has never been easier than today. Private lending companies and even banks are now only one tap and click away with the use of the internet. You do not have to exert any effort or an ample amount of time just to apply for a loan. However, admit or not, as you only focus on getting your loan approved, you tend to overlook some lending terminologies that you do not really understand. Thus, before you get into some serious debt, here’s a list of important lending jargon you must be aware of. 

1. SEC

SEC or Securities and Exchange Commission is the administrative body in charge of regulating and supervising the finance sector in the Philippines. They are responsible for formulating policies and commendations about the issues concerning the securities market. In terms of lending, SEC makes sure that lenders are operating legally while also protecting the public against exploitation and other unlawful practices. If you want to make sure that you won’t be scammed, you can always visit the official SEC website for the complete list of registered lending companies in the Philippines. 

Vidalia Lending Corp. adheres to Republic Act No. 10173 or the Data Privacy Act of 2012 and is regulated by the Securities and Exchange Commission (SEC) with License No. CS200813771 and COA No. 279 issued in October 2008. 

2. Principal

In finance, the term “principal” can convey a lot of meanings. In talks of loan, “principal” can be defined as the exact amount of money being lent to you, without the interest. However, take note that it could also mean as your loan balance after you make payment. 

3. Interest Rate

The interest rate is also known as the percentage of the principal or the cost of your loan. Lending companies offer different interest rates and you must take time comparing them first before you avail their loan offer.

4. Term Loan

The most common type of loan is called a term loan. Being on a term loan means that you agreed to make regular payments to your lender for a specific timeframe. 

5. Assets

Assets are valuable things you own which you can use as collateral if you will apply for a secured loan. A secured loan requires collateral to assure your lender that you will be repaying the money you have borrowed, but in return, they shall allow your loan a  lower interest rate.

6. Liabilities

In simple words, liabilities are the financial obligation or debts of a person or a company.  

7. Repayment Period or Tenor

Tenor is the agreed time for the borrower to repay his or her loan.

8. APR

APR or Annual Percentage Rate equal to the estimated amount of interest you need to pay plus the exact amount of the money you have borrowed. Take note that APR will depend on the lending company and the type of loan you are applying for.

9. Loan Calculator

Lending companies, most especially those you can find online, provide a loan calculator. You can use the loan calculator to estimate the loan you want to borrow, base on the terms you want and on the interest rate that the lending company offers. 

10. Credit Score

A credit score shows the creditworthiness of an individual. The higher your score, the higher the chance of securing a better interest rate.

11. Prepayment Penalty

Prepayment Penalty is also known as early repayment charges. This penalty applies when you repay your loan earlier than the agreed maturity date. 

12. Default Charges

You will have a default charge if you will miss a scheduled repayment to your lender. This just means that you will get an increase in the amount of loan you need to repay. 

Vidalia Lending has helped thousands of customers with their financial problems since 2008. If you want to apply for a loan, you can check our Loan page and choose a loan that will fit your needs. Borrow money today and get fix regular payments with no hidden fees. If you have more questions, visit our Help Center for more details.

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