Glossary

Our Glossary provides definitions for several common terms you will likely encounter throughout the application and underwriting process.

Dexter Financial Glossary of Terms

Choose your glossary terms by clicking on the alphabetical index.

A B C D E F G I L M N P R S T U V W View All

• Accrued Interest

  Interest that has accumulated since the last loan payment.

• ACH (Automated Clearing House)

  An automatic draw or draft made from a checking (or depository) account on a specific date each month.

• Additional Insured

  An insurance term in which a party is named on the policy in addition to the actual policy holder.

• Advance Payments (Up-front Payments)

  Payments submitted before the agreement is started.

• Amortization

  A schedule that shows a breakdown of the interest and principal portion of each payment and the principal balance remaining.

• Ancillary Equipment

  Equipment used in a laundry that is in addition to washers and dryers, e.g., change machine, soap vendor, laundry carts, folding tables, etc.

• Asset

  Property that has value regardless of whether or not you can see the property (tangible — e.g., an automobile) or not (intangible — e.g., contract rights).

• Assumption (Assignment)

  The process of transferring an agreement from one party to another.

• Audited Financial Statement

  Financial statements that have been reviewed by an accountant and certified as accurate.

• Balance Sheet

  A financial statement showing assets and liabilities for an entity.

• Bankruptcy

  A legal process undertaken by an individual or organization that is unable to meet its financial obligations. Debts may be reorganized or eliminated under the supervision of the bankruptcy court.

• Borrower (Debtor)

  Person or entity who obtains money from a different person or entity.

• Broker

  An intermediary who facilitates the sale of property, businesses, etc.

• Buildout (Leasehold Improvements)

  The specific construction and/or associated cost required to alter the building for the requirements of a laundry.

• Buy-sell Agreement

  An agreement that details the terms and conditions of the sale and purchase of a business.

• Cash Value Life Insurance

  The value of a life insurance policy if the policy is redeemed for cash.

• Certificate of Occupancy (CO)

  A certificate issued by a local building department to a builder or renovator indicating that the premises is in a safe condition to be occupied.

• Collateral

  Assets that are used to secure the repayment of a financial obligation.

• Commitment Letter

  A letter that briefly explains the terms and conditions of a pending financial transaction.

• Corporate Resolution

  A document signed by the officers of a corporation that certifies that the individual signing an agreement on behalf of the corporation has the authority to enter the corporation into an agreement.

• Covenants

  A legal promise to do something or refrain from doing something.

• Credit Bureau Report

  The report generated by the credit bureau that shows a person or entity’s credit history.

• Credit Worthiness

  The ability of a person or entity to obtain credit.

• Default

  The act of failing to meet obligations, including paying money owed, when due.

• Demographic Study

  A study used to evaluate customer trends and characteristics within a given geographic area.

• Distributor

  An entity that provides equipment for sale to the public.

• Documentation

  The process of preparing written evidence of a financial contract.

• Documentation Fee

  A fee charged to prepare loan or lease paperwork.

• Expenses

  Items that cost money to use, excluding money spent to acquire assets.

• Fixed Rate

  An interest rate that remains constant over the term of the loan.

• Floating Rate (Variable Rate)

  An interest rate that may change over the term of the loan.

• Free-standing Building

  A building that typically has only one tenant.

• Gross Income

  Total income from the operation of a business before deducting expenses.

• Income Statement

  A financial statement that shows business income and expenses for a specified period of time.

• Landlord Subordination

  A document signed by the landlord of a premises in which the landlord agrees to subordinate any legal interest in their tenant’s personal property to that of tenant’s creditor.

• Landlord Waiver

  A document signed by the landlord of a premises in which the landlord waives any legal claim in personal property brought onto the premises.

• Late Fee

  A fee charged for a payment that is not paid by the due date.

• Lease Agreement

  An agreement for the use and possession of equipment for a specified period of time.

• Leasehold Improvements (Buildout)

  The specific construction and/or associated cost required to alter the inside of building for the requirements of a laundry.

• Lendor

  An individual or entity that loans money to others.

• Lessee

  The entity that contracts with a lessor for the use of equipment for a specified period of time.

• Lessor

  The entity that provides equipment for use by a lessee.

• Loan

  Temporary borrowing of a sum of money.

• Loss Payee

  An individual or entity to whom an insurance loss payment or insurance settlement may be directly paid.

• Mortgage Holder

  The person or entity provided financing that is evidenced by a mortgage contract.

• Net Cash Flow

  The money from business operations after deducting expenses without taking into account any depreciation, or amortization.

• Net Worth

  The monetary value of a person or entity calculated by subtracting liabilities from assets.

• NSF Check (Non-sufficient Funds Check or Check Returned Unpaid)

  A check that is returned as unpaid due to insufficient funds in the account from which the check is issued.

• NSF Fee

  A fee charged for presenting a check that did not clear the bank.

• Payment Schedule

  A document that shows payment due dates for a specific obligation.

• Payoff

  Payment in full of a financial obligation.

• Personal Property

  Property owned by an individual or entity excluding land.

• Personal Property Tax

  Tax assessed by the taxing authority based on the value of personal property located within the taxing authorities jurisdiction.

• Principal Balance

  The amount of debt remaining on a financial obligation excluding interest.

• Property Insurance

  An insurance policy that covers real and/or personal property.

• Proposal

  An initial estimate of cost for the sale of goods and/or services.

• Real Property

  Land and/or other property that can't be moved.

• Refinancing

  The process of obtaining financing to pay off an existing debt.

• Rent

  Compensation for the possession and use of real or personal property.

• Repayment

  The process of returning money that was borrowed.

• Residual Value

  The anticipated value of property at the end of a specified lease term.

• Revenue

  Money generated from business operations.

• Security Agreement

  A legal document in which a borrower authorizes a creditor a legal claim to certain property to secure repayment of a financial obligation.

• Shareholder

  A person (or entity) who owns stock or shares of a corporation.

• Start Date (Commencement Date)

  The date that an agreement begins.

• Strip Mall

  A commercial multi-tenant building that is typically a long building facing a road that is divided into separate stores and/or businesses with parking spaces in front.

• Tenant

  A person or entity that is renting real property from another person or entity.

• Term

  The length of a contract, usually expressed in months.

• Term Loan

  A loan that is to be repaid during a specific period of time.

• Underwriting

  The process of evaluating the credit worthiness of an applicant.

• Underwriting Questionnaire

  A questionnaire that is used to collect basic information about a specific location.

• Variable Rate (Floating Rate)

  An interest rate that may change over the term of the loan.

• Working Capital

  Money used to operate a business.