ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Debt can be simply understood as the amount owed by the borrower to the lender. A debt is the sum of money that is borrowed for a certain period of time and is to be return along with the interest.

Detailed explanation-2: -Principal: The amount of debt, exclusive of interest, remaining on a loan. Principal and Interest to Income Ratio: The ratio, expressed as a percentage, which results when a borrower’s proposed Principal and Interest payment expenses is divided by the gross monthly household income.

Detailed explanation-3: -A debtor is a company or individual who owes money. If the debt is in the form of a loan from a financial institution, the debtor is referred to as a borrower, and if the debt is in the form of securities-such as bonds-the debtor is referred to as an issuer.

Detailed explanation-4: -A loan is a form of debt but, more specifically, an agreement in which one party lends money to another. The lender sets repayment terms, including how much is to be repaid and when, as well as the interest rate on the debt.

Detailed explanation-5: -Check Your Credit Reports Your credit report lists the amount owed on every account, along with its status and payment history, and contact information for the creditor handling the debt. Under federal law, you can obtain one free copy of your credit report every 12 months by visiting AnnualCreditReport.com.