Jargon buster

Taking the mystery out of loans

Personal loans

A guide to financial jargon

Picking the right loan for you can be tricky enough without feeling confused by the range of financial jargon surrounding the product. Here's some of the key loan terms explained to help you make the right decision:



Icon expand APR (Annual Percentage Rate)

The purpose of an APR is to show the total cost of borrowing over the period of an average year so, as well as interest, the figure includes upfront fees and charges. This makes it easier to compare deals like for like.


Icon expand CCJ (Country Court Judgment)

It is issued by a County Court for failing to repay a loan or outstanding debt, and will have a negative impact on your credit rating and may affect your ability to get a loan or mortgage.


Icon expand Credit rating or score

This is the 'score' given to you depending on your personal credit history. So if you've always kept up repayments on any form of credit you've had, you'll have a good credit rating, whereas if you've failed to meet payments or, say, have a CCJ against your name, your credit rating is likely to be poor. 


Icon expand ERC (Early Repayment Charge)

A one off charge applied by the lender if you decide to pay off your loan early, before the term set when applying for the loan


Icon expand Fixed interest rate

A set rate of interest that cannot go up or down during the period of the loan. 


Icon expand Interest

When you borrow money, the lender will make a charge – known as interest. For example, if you borrow £100 at an interest rate of 10% for one year, you would have to repay £110 at the end of the year. 


Icon expand Quote

The estimated cost of a loan, usually showing monthly repayments and the total amount that will need to be repaid.

The actual cost of your loan could be different from the quote - we, work out the actual cost based on your specific circumstances. We’ll give you the actual cost during your application. 


Icon expand Total amount payable

This includes the capital amount borrowed plus the interest charged. 


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