Glossary of Financial Terms
A form used to report mortgage interest of $600.00 or more.
A form used to report income from dividends and distributions.
A form used to report interest income, including savings bond interest.
A form used to report miscellaneous types of income not covered by other forms, i.e., income from rents or royalties.
A form used to report income from original issue discounts which has accrued for the taxpayer, but is not paid until
A form used to report distributions from a retirement account IRAs, SEPs, Keoghs or Deferred Compensations accounts.
ABA Routing and Transit Number. A unique identifying number assigned by the American Bankers Association under the
National Numerical System. The transit number appears in the right corner of checks as the numerator (upper portion) of a
It has two parts, separated by a hyphen:
- First part identifies the city, state or territory in which the bank is located
- Second part identifies the bank itself.
The current balance in a customer account. This balance does not take into consideration any holds or floats that may
be in effect on the account.
Actual Day (Interest)
Interest is calculated using a year base factor for the actual number of days in the interest posting period.
If the account is paid monthly it will receive either 28, 29, 30, or 31 days of interest depending on the month
If the account posts interest quarterly, the account will have either 90, 91, or 92 days of interest depending on
Note: Calendar/Maturity Posting Accounts and Anniversary Posting Accounts must calculate interest on actual
Adjustable Rate Mortgage (ARM)
A mortgage where the lender is able to change the interest rate periodically throughout the term of the loan. For more
information see Adjusted Rate Mortgage.
A written acknowledgment by a bank of a transaction affecting an account.
Examples: Debit Advice & Credit Advice
A voluntary statement of facts signed before a notary public, court officer, or other authority.
Any person that is not a United States citizen.
Data that can include letters, but not numbers.
Data that can include letters, special characters, and/or numbers.
A check on which a material change, such as in the dollar amount, has been made. Banks are expected to detect
alterations and are responsible for paying checks only as originally drawn.
American Bankers Association (ABA)
The association of American bankers.
The gradual reduction of a loan or other obligation by making periodic payments of principle and interest needed to
pay off the loan.
Anything owned that has commercial or exchange value. Assets may consist of specific property or of claims against
others, in contrast to obligations due to others (liabilities).
Amount a customer can withdraw at an ATM per day.
A formal or official examination and verification of accounts.
The signature of those parties who have the legal right to issue instructions regarding an account.
Automated Clearing House (ACH)
A central automated clearing house facility that:
- receives paperless entries from ODFI's (originating deposit financial institutions)
- distributes entries to RDFI's (receiving deposit financial institutions)
- performs the settlement function with the Federal Reserve Bank on behalf of those institutions
Automated Teller Machine (ATM)
An electronic facility, usually located inside or apart from a financial services institution. It dispenses cash,
allows deposits, accepts payments to loans and credit cards, and allows transfers. The transaction selection varies from
ATM to ATM.
A list indicating the number of days that must elapse before deposited checks can be considered cleared or usable
The portion of the customer's account balance on which the bank has placed no restrictions, making it available for
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