| Credit
grantors generally issue three types of accounts. The basic
terms of these account agreements are:
Revolving Agreement
(Typical Credit Card Account)
You may pay in full each month or choose to make a partial
payment based on the outstanding balance. If you make a partial
payment, you will be charged interest (a "finance charge")
on the portion of the balance you do not pay. Department stores,
gas and oil companies, and banks typically issue credit cards
based on a revolving credit plan.
Charge
Agreement
You promise to pay the full balance each month, so you do
not have to pay interest charges. Charge cards and charge
accounts with local businesses often require repayment on
this basis.
Installment Agreement
You sign a contract to repay a fixed amount of credit in equal
payments over a specific period of time. Automobiles, furniture,
and major appliances often are financed this way. Personal
loans usually are paid back in installments, too.
 
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