Bank Jargon 102

by Spencer Tierney 26. June 2014

Banking Terms

Do financial statements baffle you? Do your eyes glaze over when your banker seems to be speaking another language? Chances are you aren’t up to speed on the latest bank jargon. Once you decode these common bank terms, you’ll be in a better position to manage and grow your assets.

Available Balance

You may have noticed that deposited funds aren’t reflected immediately on an online bank statement or paper receipt. That discrepancy occurs because your available balance refers to the total account balance minus any uncollected funds or restrictions. Checks that still have to be cleared won’t show up. Additionally, if your account has any debits pending or other restrictions, your available balance will be less than the full amount deposited to the account.

Understanding an available balance is vital because it reflects the accurate amount of your usable cash. Always refer to this figure when writing checks or paying bills online to avoid overdrafts or bounced checks.

Credit Card Balance Transfer

A balance transfer allows you to move your outstanding balance from one credit card to another, usually to reduce the interest rate or enjoy a period of no interest at all. The promotional rate only applies for a fixed period and you may have to pay a balance transfer fee.

Balance transfers can help you pay off debt faster and with less expense.

Certified Check

When you make a major purchase, you may be asked to pay by certified check. A certified check is a check drawn from your account that’s guaranteed. Your bank will certify a check on your request, with a bank official’s signature. This signature guarantees that your signature is genuine, that you have sufficient funds in your account and that these funds have been earmarked to pay this check. Most banks charge a fee for a certified check. See the 1st Mariner Bank Schedule of Charges for details.

Understanding certified checks ensures that you’ll be able to make purchases that require them without unnecessary delay or complication.

Co-Signer

When a borrower has insufficient credit, he or she may need a co-signer for credit approval. A co-signer promises to pay a loan or satisfy a financial obligation if the primary account holder defaults. A co-signer’s legal responsibilities may include the full amount of the debt as well as interest, late fees and collection costs.

If you don’t have good credit, finding a co-signer may help you borrow money and establish credit. If on the other hand, someone asks you to co-sign a loan or credit card, a clear understanding of what this obligation entails is essential.

Frozen Account

If your account is frozen, this means you won’t have access to that money until the bank unlocks it. Accounts may be frozen due to liens, court orders, legal processes or dispute over account ownership.

Knowing why accounts are frozen may help you avoid this experience. If your paychecks are directly deposited to an account that gets frozen, you’ll need to stop this direct deposit immediately for continued access to your pay.

Traditional Individual Retirement Account (IRA)

Traditional IRAs are retirement savings accounts that are tax-deductible up to certain specified limits. You can’t withdraw these funds without penalty until you reach age 59½. Once you withdraw money from your IRA, it becomes taxable income.

Investing in an IRA may significantly reduce what you owe in income tax today, while helping you save for retirement.

Loan-to-Value Ratio (LTV)

LTV is the ratio of the amount you’re borrowing to the actual value of your purchase. For example, if you need to borrow $450,000 to purchase a $500,000 home, your LTV would be 90%.

The lower your LTV, the more likely you’ll be able to negotiate good interest rates and loan terms.

Payable-on-Death (POD) Account

A POD account allows you to designate a beneficiary who’ll inherit this account after your death. During your lifetime your beneficiary has no access to your account.

Converting your bank accounts to POD status assures that your assets will automatically belong to your loved ones when you pass, with no danger of a probate delay.

Power of Attorney (POA)

A POA is a legal document that authorizes one person to act for another. It may be a general authorization or a specific one defining a time period, act or event.

If a loved one becomes too ill to manage finances, he/she may grant you power of attorney to make important decisions for him/her or make payments from his/her bank accounts. Even a healthy person may use a POA, such as the case when you’d want to grant your accountant power of attorney to obtain certain financial documents on your behalf to resolve a tax dispute.

Spencer Tierney is a staff writer for NerdWallet, where he covers all aspects of personal finance.

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A Message from 1st Mariner Bank's New President & COO

by Robert Kunisch 23. June 2014

I'm happy to report that on Tuesday, June 17th we completed the final step in the recapitalization of 1st Mariner Bank.

It has been a long and arduous process, but Tuesday’s closing allows us to move forward with the revitalization of 1st Mariner Bank. Now, 1st Mariner has $100 million in fresh capital, 16 branches, roughly 430 employees and meets all regulatory tests. In short, we are poised for growth.

I’d like to use this post to introduce myself as the new president and COO of 1st Mariner Bank. I am a Baltimore native and I have almost 30 years of banking experience. Most recently, I was president of Wilmington Trust FSB, Maryland, and spent the majority of my career at Mercantile Bank in Baltimore.

Today, 1st Mariner is stronger than ever and is now positioned to deliver more products and services to meet your needs. We are devoted to investing in resources and technologies to better serve our retail and commercial customers.

Since the beginning, 1st Mariner Bank has been a unique asset to the Baltimore community and continues as the largest independently owned bank in the city.

Baltimore and the surrounding region offer many opportunities for growth and I look forward to building and maintaining a successful hometown bank.

The 1st Mariner team realizes the opportunity we have to help you meet your financial goals. What you should know is that your opinion matters, so if you have questions, concerns or suggestions, please do not hesitate to contact me.

I also want you to know that I, along with our Chairman and CEO Jack Steil and our new board of directors are committed to 1st Mariner Bank. Without a doubt, we are energized and optimistic about the future of 1st Mariner Bank.

Sincerely,

Robert Kunisch, Jr.

Robert Kunisch, Jr.
President & COO
1st Mariner Bank 

Fun Ways to Teach Kids about Money

by Sara Seeger 19. June 2014

1st Mariner Piggy Bank

Encouraging positive and responsible money habits in your children's minds is arguably one of life's most important lessons. The sooner children start learning about the "value of a dollar," the better. However, kids don't have to know how to count to be introduced to and taught about money. Luckily, with today's technology, there are many ways to make learning about money fun for kids of any age. Read on for some quick tips to make learning about money fun.

1) Use Cash Yourself

Try not using a credit or debit card on everyday purchases. By allowing your children to see you use cash, they will begin to understand the value and purpose of money. Other great ways to introduce your child to money is to take them to an ATM so they can watch you withdraw money, or let them deposit coins in a parking meter.

2) Give Them a Piggy Bank

Children's piggy banks come in a variety of colors and designs. Some even have their favorite movie character or superhero. A piggy bank will teach children to put away money for saving, and that this savings can be used to purchase an item or toy they really want. There is also a newer "modern" piggy bank that has multiple slots that divide money into categories such as save, spend, invest and donate.

3) Go Online

The Internet is full of age specific money games for kids. T. Rowe Price teamed up with Disney to create an interactive, online game called “The Great Piggy Bank Adventure.” This game teaches age appropriate financial lessons, such as the importance of saving money with a specific goal, interest, and financial distractions.

4) Play Games

Board games are also an easy and non-invasive way to talk about money. Board games, such as Monopoly, The Game of Life, and Payday, help children develop and master their financial management skills.

5) Give Them an Allowance

There’s a strong argument that an allowance is the best way to teach a child about handling financial responsibility. An allowance reinforces the lessons that money is limited (even yours) and it must be earned. Use allowances to combat the “I want this” during a Target trip, and let your child know that they need to bring their own money from their allowance if they want to buy something.

If you found this article useful, be sure to check out these related articles:

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