Anywhere Banking
Customer can deposit/ withdraw cash at any branch other than the branch in which he holds the account. Anywhere banking frees the customer from geographical boundaries and limitations and gives the flexibility to the customer to use his account across the board.
Bridge Loan
It is also known as a “Swing Loan.” It helps you bridge the gap when you have more than one obligation. It is usually a loan made against the current home, which has not yet been sold, to fund the down payment on a new home. The loan gets paid when the first home is sold. It is typical in real estate.
Correspondent Banking
When one bank helps another bank with their business, it is called Correspondent Banking. This may be a bigger bank helping a smaller with a mortgage, allowing the smaller bank to offer its customers mortgage products, allowing the smaller bank to leverage the rates and terms of the bigger bank. Mortgage loans go through a correspondent underwriting process to determine if they are acceptable. The larger bank can benefit by receiving fees for servicing the loan. Merchants Bank offers correspondent mortgage services to other community banks.
Bank Draft
An instrument issued by one branch of a bank on another branch of the bank containing an order to pay a certain sum on demand to the person named on the draft. It is used to transfer funds and to settle outstanding balances between banks, or to provide a customer with funds payable at a bank in a different location. Bank drafts are valid for certain period, generally, for 6 months, as indicated over face of draft.
Collateral
An asset pledged to a lender to guarantee repayment. Collateral could include savings, bonds, insurance policies, jewelry, property or other items that are pledged to pay off a loan if payments are not made according to the contract. Collateral is not required for unsecured credit card accounts.
Consolidation Loan
If you owe money to several creditors, you can combine your payments and balances into a single account with one creditor. This can be done in several ways. For example, you can transfer several high interest credit card balances onto one card with a lower rate. If you own a home, you can consolidate your debt with a low-interest home equity loan. Or, you can get a loan specifically designed for this purpose.
Credit Appraisal
This is the process for evaluating credit worthiness of any loan proposal. This helps establish the risks involved in the proposal and debt servicing capacity of the borrower. A wide-range of criteria viz. age of borrower, credit score, existing loan obligations, nature/ sources/ stability of income etc. are taken into account. Credit History of the person is an important criterion for sanction of credit.
Credit Limit
It is the maximum amount of money one can draw on his account based on prior sanction or approval from the bank. Borrowing or drawing limit fixed by a bank for a customer depending on his credit history, repaying capacity and relationship with bank.
Deposit at Call
Receipts issued to customers for amount deposited and repayable on demand. A facility normally extended for payment of earnest money deposits in tenders.
Floating Rate
Floating rate or variable interest rate as it is also called doesn't remain fixed for the entire tenure of the loan. It varies according to the market conditions. This rate is linked to an external, market determined benchmark e.g. LIBOR. The lending is expressed with a spread above or below the benchmark rate. Re-pricing takes place after a predetermined period say, 6 months when the lending rate will be revised with reference to the benchmark rate as on that day.
Customer can deposit/ withdraw cash at any branch other than the branch in which he holds the account. Anywhere banking frees the customer from geographical boundaries and limitations and gives the flexibility to the customer to use his account across the board.
Bridge Loan
It is also known as a “Swing Loan.” It helps you bridge the gap when you have more than one obligation. It is usually a loan made against the current home, which has not yet been sold, to fund the down payment on a new home. The loan gets paid when the first home is sold. It is typical in real estate.
Correspondent Banking
When one bank helps another bank with their business, it is called Correspondent Banking. This may be a bigger bank helping a smaller with a mortgage, allowing the smaller bank to offer its customers mortgage products, allowing the smaller bank to leverage the rates and terms of the bigger bank. Mortgage loans go through a correspondent underwriting process to determine if they are acceptable. The larger bank can benefit by receiving fees for servicing the loan. Merchants Bank offers correspondent mortgage services to other community banks.
Bank Draft
An instrument issued by one branch of a bank on another branch of the bank containing an order to pay a certain sum on demand to the person named on the draft. It is used to transfer funds and to settle outstanding balances between banks, or to provide a customer with funds payable at a bank in a different location. Bank drafts are valid for certain period, generally, for 6 months, as indicated over face of draft.
Collateral
An asset pledged to a lender to guarantee repayment. Collateral could include savings, bonds, insurance policies, jewelry, property or other items that are pledged to pay off a loan if payments are not made according to the contract. Collateral is not required for unsecured credit card accounts.
Consolidation Loan
If you owe money to several creditors, you can combine your payments and balances into a single account with one creditor. This can be done in several ways. For example, you can transfer several high interest credit card balances onto one card with a lower rate. If you own a home, you can consolidate your debt with a low-interest home equity loan. Or, you can get a loan specifically designed for this purpose.
Credit Appraisal
This is the process for evaluating credit worthiness of any loan proposal. This helps establish the risks involved in the proposal and debt servicing capacity of the borrower. A wide-range of criteria viz. age of borrower, credit score, existing loan obligations, nature/ sources/ stability of income etc. are taken into account. Credit History of the person is an important criterion for sanction of credit.
Credit Limit
It is the maximum amount of money one can draw on his account based on prior sanction or approval from the bank. Borrowing or drawing limit fixed by a bank for a customer depending on his credit history, repaying capacity and relationship with bank.
Deposit at Call
Receipts issued to customers for amount deposited and repayable on demand. A facility normally extended for payment of earnest money deposits in tenders.
Floating Rate
Floating rate or variable interest rate as it is also called doesn't remain fixed for the entire tenure of the loan. It varies according to the market conditions. This rate is linked to an external, market determined benchmark e.g. LIBOR. The lending is expressed with a spread above or below the benchmark rate. Re-pricing takes place after a predetermined period say, 6 months when the lending rate will be revised with reference to the benchmark rate as on that day.
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