Glossary of Financial Terms
Magnetic Ink Character Recognition (MICR)
The American Bankers Association program that provides for encoding of checks and documents with characters in
magnetic ink so that they can be electronically read and processed. On a plastic card, information is stored on the
A deposit received through the mail, as opposed to an over-the-counter transaction.
The party who executes an instrument, such as a check, draft, or note.
The date on which a note, loan, draft, bond, time deposit, or acceptance becomes due. Also known as due date.
A notice produced when a savings term account reaches its maturity date. The maturity date, account number, balance
and interest rate the account was earning through the maturity date will appear on the form. The form can state that the
ACCOUNT WILL RENEW or the ACCOUNT WILL MATURE AND NOT RENEW.
Maturity notices are also created for Consumer Loans and Mortgage Loans.
The number used to differentiate multiple plastic cards issued under the same card and account number. The Member
Number allows a bank to lock out an individual card linked to an account rather than locking out an entire account.
Example: If on a joint account, a husbandís card is lost or stolen, then just his card with his member number can be
locked out and the wifeís card may continue to be used.
The combination of two or more formerly independent firms under a single ownership
Monetary Control Act
The 1980 legislation that provided for the gradual phase out of interest rate ceilings, made all financials subject to
reserve requirements, and gave expanded powers to thrift institutions.
Mortgage Insurance Premium
Home mortgages with a down payment of less than 20% must pay this premium to insure the mortgage. Also referred to as
Private Mortgage Insurance or PMI.
Mortgage Loan (ML)
The general banking term for loans extended to individuals to purchase homes. These loans usually have monthly
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Party to whom the property is mortgaged, the lender.
The customer borrowing money from an institution. The person who mortgages the property.
A bond issued by any local or state government, or agency or authority of government, other than the federal
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