A finance charge is often an aggregated cost, including the cost of the carrying the debt itself along with any related transaction fees, account maintenance fees or late fees charged by the lender.
Finance charges allow lenders to make a profit on the use of their money. Finance charges for commoditized credit services like car loans, mortgages and credit cards have known ranges and will depend most on the credit-worthiness of the person looking to borrow.
Regulations exist in many countries that limit the maximum finance charge assessed on a given type of credit - but many of the limits still allow for predatory lending practices, where finance charges can amount to 25% or more annually.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
finance charge — The total cost of credit a customer must pay on a consumer loan, including interest. Bloomberg Financial Dictionary * * * ▪ I. finance charge finance charge ➔ charge1 [m0] ▪ II. finance charge finance charge … Financial and business terms
finance charge — n. A fee charged for the extension of credit and the deferral of payment of a loan. The Essential Law Dictionary. Sphinx Publishing, An imprint of Sourcebooks, Inc. Amy Hackney Blackwell. 2008. finance charge The am … Law dictionary
Finance charge — In United States law, a finance charge is any fee representing the cost of credit, or the cost of borrowing. It includes not only interest but other charges as well, such as financial transaction, transaction fees. Details regarding the federal… … Wikipedia
finance charge — / faɪnæns tʃɑ:dʒ/ noun 1. the cost of borrowing money 2. an additional charge made to a customer who asks for extended credit … Dictionary of banking and finance
finance charge — The consideration for privilege of deferring payments of purchase price. The amount however denominated or expressed which the retail buyer contracts to pay or pays for the privilege of purchasing goods or services to be paid for by the buyer in… … Black's law dictionary
finance charge — A charge levied for the benefit of being able to delay payment of a sum due … Accounting dictionary
finance charge — interest or a fee charged for borrowing money or buying on credit. * * * … Universalium
finance charge — interest or a fee charged for borrowing money or buying on credit … Useful english dictionary
charge — The document evidencing mortgage security required by Crown Law (law derived from English law). A Fixed Charge refers to a defined set of assets and is usually registered. A Floating Charge refers to other assets which change from time to time (… … Financial and business terms
Charge — or charged may refer to: Charge (basketball), illegal contact by pushing or moving into another player s torso Charge (fanfare), a six note trumpet or bugle piece denoting the call to rush forward Charge (heraldry), any object depicted on a… … Wikipedia