Debt

Debt (dɛt)

Debt (pronounced /dɛt/) is a term used in the field of Economics and Finance to describe an amount of money or other assets that is owed by one party, the borrower or debtor, to a second party, the lender or creditor.

Etymology

The term "debt" originates from the Old French dete, and ultimately from the Latin debitum which means "thing owed".

Related Terms

• Creditor: A person or company to whom money is owed.
• Debtor: A person or company that owes money.
• Interest: The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.
• Loan: A thing that is borrowed, especially a sum of money that is expected to be paid back with interest.
• Bankruptcy: A legal proceeding involving a person or business that is unable to repay their outstanding debts.
• Collateral: An item of value used to secure a loan, and subject to seizure if the loan is not repaid.
• Default (finance): Failure to meet the legal obligations (or conditions) of a loan.
• Credit (finance): The granting of a loan and the creation of debt. Any movement of financial capital is normally quite dependent on credit, which in turn is dependent on the reputation or creditworthiness of the entity which takes responsibility for the funds.

External links

• Medical encyclopedia article on Debt
• Wikipedia's article - Debt

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