revolving charge account

Thân thiện

A customer uses a revolving charge account to purchase a new television.

Definition

1. Noun:
   • A type of credit account: A "revolving charge account" is a specific kind of credit arrangement, typically with a store or financial institution, where the user has a pre-approved credit limit. The user can make purchases up to this limit and is required to make regular payments. Crucially, as payments are made, the available credit is replenished, allowing the user to borrow again without applying for a new loan, provided the outstanding balance remains below the credit limit.

Usage

• This term is used in the context of personal finance, retail, and banking. It describes a flexible line of credit for consumers.
• It is often contrasted with installment accounts (where a fixed amount is borrowed and paid back in set increments) or charge accounts that require payment in full each billing cycle.

Examples

• Noun:
  • She used her revolving charge account at the department store to buy a new coat.
  • The bank offered him a revolving charge account with a $5,000 limit and a competitive interest rate.
  • Managing a revolving charge account responsibly can help build a good credit history.

Advanced Usage

• "to maintain a revolving charge account": to keep such an account open and in good standing by making at least the minimum payments.
  • It is important to maintain your revolving charge account by paying on time.
• "the terms of a revolving charge account": refers to the specific conditions like the credit limit, annual percentage rate (APR), and minimum payment requirements.
  • Always review the terms of a revolving charge account before you agree to open one.

Variants and Related Words

• Revolving credit (n): A broader financial term that encompasses revolving charge accounts, as well as lines of credit like credit cards. A revolving charge account is a common form of revolving credit.
• Charge account (n): A more general term for a credit account with a seller. A revolving charge account is a specific type of charge account.
• Credit limit (n): The maximum amount that can be borrowed on a revolving charge account.
• Minimum payment (n): The smallest amount that must be paid by the due date to keep the revolving charge account in good standing.

Synonyms

• Revolving credit account: A very close synonym, often used interchangeably.
• Open-end credit: A formal financial term describing the same concept of reusable credit up to a set limit.

Related Phrases

• Carry a balance: To have an unpaid debt on a revolving charge account from one billing cycle to the next, typically incurring interest charges.
  • If you carry a balance on your revolving charge account, you will be charged interest.
• Available credit: The remaining amount a user can spend on a revolving charge account, calculated as the credit limit minus the current balance.
  • Her revolving charge account still had $300 of available credit.

Học thuật

Noun

1. a charge account that does not have to be paid to zero balance