Credit Union Terms 16. April 2019 Administrator Blog (0) A credit union is a financial cooperative that is created, owned and operated by its members. It provides credit at competitive rates in addition to a plethora of financial services to its members. Following is a list of some terms that are commonly used in credit unions:Account Agreement: The agreement that determines membership eligibility, conditions for share accounts and other banking operations.Accrued Interest: Interest that is due but has not yet been paid to an account holder of a share account. It can also be due interest that has not yet been paid to the credit union by borrower of a loan.Adjustable-Rate Mortgage: A mortgage without a fixed interest rate. The rate fluctuates on the basis of market conditions such as index rate.Annual Percentage Rate: Percentage indicating the cost of credit on a yearly basis.Annual Percentage Yield: A percentage indicating the total amount of interest paid on a share account. The amount is based on the interest rate and frequency of compounding for the year.Annuity: Life insurance contract sold by brokers, insurance companies and other institutions as retirement investment.Automatic Bill Payment: An automated system for an account holder to pay recurring bills.Available Credit: The remaining amount of funds in a line of credit or account that a member can borrow.Closing Costs: Expenses incurred by sellers and buyers when transferring the ownership of property.Collateral: Assets offered by a borrower for securing a loan or some other form of credit.Drawer: A person/entity who writes a check or draft asking the drawee to pay another.Drawee: The credit union or financial institution expected to pay a check or draft that is presented for payment.Escrow: The act of holding money or documents by a neutral third party prior to closing the property.Foreclosure: Legal process of selling property and using the proceeds for covering a mortgage debt.Open-End Credit: A credit agreement allowing members to borrow against pre-approved credit line for purchasing goods and services.Overdraft: When the amount in an account falls short of the amount being withdrawn from a checking account or share draft account.Payee: A person or organization to whom a check, draft or note is made payable.Payoff: Complete repayment of a loan.Share Draft Account: Checking accounts are called share draft accounts by credit unions. They are transaction accounts.Uncollected Funds: A part of a deposit balance that is due to be collected by the depository financial institution.For more information, visit Greater Central Texas Federal Credit Union at 3305 E. Elms Rd., Killeen, TX-76542 or call at (254) 690 – 2274.