Jargon Buster

To make minor changes in order to make something more accurate, or to reflect changing circumstances.

A legal proceeding involving a person or business that is unable to repay outstanding debt.

Bank Verification
Is a secure online tool you can use to log in to your internet banking to let us view your most recent set of bank transactions/statements – this is to save you having to send us copies via email or fax.
Rest assured, we cannot make any changes or transactions on your accounts using this online tool.

A broker is a person who buys and sells things on behalf of others.
Brokering is when a person or a company acts as an intermediary between buyers and sellers.
A broker fee typically applies and will be added to the lenders contract.

A budget is a financial plan or estimate of income and expenses for a set period of time.
A budget is used to project future income and expenses.
Please use the budgeting tool from sorted.or.nz for assistance in preparing your budget.

A company to whom a person owes money.

Credit Reference
This is a statement of information provided by a company that declares a person’s history of credit payments, etc.
Credit agencies in New Zealand are Veda, Dunn & Bradstreet, Centrix, etc. Most offer a free credit report service.

Compound Interest
Where interest is calculated on both the amount borrowed and any previous interest applied.
Our interest is calculated and compounded daily, but may be different for other lenders.

Where a creditor combines all of your existing loan repayments into one and pays these existing loans off for you.
With this service you can eliminate the need to make multiple loan payments and can often eliminate a higher interest debt for lower interest rates.

You, the person who applies for a loan.

Default – (On a credit check report)
An amount of money that is currently owed to a company, which is then lodged as a ‘default’ in your credit history or credit score with a reporting agency due to non-payment.

Default Interest 
Interest that is charged on an account that has fallen in to arrears/dishonoured on agreed payments as set out in their contract. Default interest is charged only on the amount that is overdue. Once the overdue amount is paid and the account is brought up to date, default interest is no longer applied.

Direct Credit
A direct credit is where you deposit the amount of money to pay your bill directly into the Company’s bank account.

Direct Debit
A direct debit is a method of payment where the Company organises with you to take the exact amount of money owing from your nominated account on the due date/s.

When someone is unable to pay debts owed.

Long-Term Loan
A loan that is lent for a long period of time, usually over a 1-3 years term.

Mid-Term Loan
A loan which is spread out over a 3-12 month term.

Net Surplus
This is the amount of your income that is left over after you have paid all of your outgoing expenses.

Example: $1000.00 (income) - $600.00 (food/rent/petrol) = $400.00 (net surplus).

No Asset Procedure (or NAP)
A NAP is a legal proceeding designed to assist a person who has total debts of $1,000 to $47,000, has no assets and has no financial means to pay back the debts.

Pay After Tax
This is the amount that you receive from your salary or wage after your tax has been taken out.
This is the amount that shows up in your bank account either weekly, fortnightly or monthly.

Pre-Qualify or Pre-Qualified
Where someone has qualified or met the initial criteria before going through to the application phase.

Repayment Waiver
Where a lender agrees, for a fee, to temporarily (or in some cases, permanently) give up their right to pursue the borrower for what they owe, if the borrower suffers; total disablement, a serious illness, are made redundant or die during the term of a loan agreement.

Settlement Figure
A figure that is calculated to pay a debt in full on a particular date.

Short-Term Loan
Money that is lent for a short amount of time, usually over a 1-3 month term.

Summary Instalment Order (or SIO)
An SIO is a formal agreement between a consumer and their creditors to pay some (if not all) the money owed over a period of time ranging 3 to 5 years. This formal agreement is managed and overseen by a Government Approved Supervisor.