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GLOSSARY
Redlining
The illegal practice sometimes used by shady lenders and insurance companies to deny loans and other services to people because of their neighborhood or ethnicity.
Refinance wave
A refinance wave is a trend of mortgage refinancing that is prompted by a large drop in market interest rates. The rate drop must large enough that borrowers can save a noticeable amount of money in total interest and monthly payment amount, even after considering the out-of-pocket closing costs associated with a refinance.
Refinancing
Repaying a mortgage with another mortgage which has a lower interest rate. Homeowners typically take advantage of turning their equity into cash.
Refinancing risk
Refinancing risk is the chance that the costs for renewing a debt facility will be higher than expected. Say, for example, that a company owes $100,000 on a short-term, interest-only loan. At maturity, if the company can't pay off the debt, it must be refinanced at whatever rate is available, given prevailing economic conditions. There's a risk that the best rate available will be higher than the company can afford.
Refund
A refund is a return payment of previously collected funds. In taxes, for example, the government sends a refund check to taxpayers who overpay during the tax year.
Refundable credit
Refundable credit is a tax credit that can result in the government owing funds to the taxpayer. Refundable credits can reduce a taxpayer's tax liability to a negative number, such that the government then owes the negative amount to the taxpayer.
Regional bank
A regional bank focuses its services on a target customer base that's defined by a large geographic area, such as a state. Regional banks are somewhat larger than community banks, but they don't have a national presence.
Registered Education Savings Plan - RESP
Registered Education Savings Plan, or RESP, is a college savings program available in Canada. Contributions are made with after-tax money, but earnings made within the plan grow tax-free.
Registered Pension Plan - RPP
Registered Pension Plan, or RPP, is a pension benefit trust available in Canada. An employer establishes the RPP, and contributions are made by the employer and employee. Contributions are tax-free and earnings are tax-deferred. Taxes are incurred on withdrawals made from the plan.
Registered Retirement Income Fund - RRIF
Registered Retirement Income Fund, or RRIF, is an annuity program available in Canada. RRIFs are often funded by Registered Retirement Savings Plans (RRSPs). The RRIF is structured to provide a stream of income payments to the accountholder during retirement. These income payments are taxed as income.
Registered Retirement Savings Plan - RRSP
A Registered Retirement Savings Plan, or RRSP, is a retirement trust available in Canada. Similar to the U.S. IRA, the RRSP allows for tax-deductible contributions and tax-deferred earnings. Money held in the RRSP can be invested in stocks, mutual funds, bonds, etc.
Registered Retirement Savings Plan Contribution - RRSP Contribution
A Registered Retirement Savings Plan contribution, or RRSP contribution, is a tax-deductible deposit made to an RRSP, which is a retirement trust available in Canada. RRSP contributions are subject to annual limitations, but any allowable amounts not used during the year can be carried forward indefinitely.
Registered Retirement Savings Plan Deduction - RRSP Deduction
A Registered Retirement Savings Plan deduction, or RRSP deduction, is the tax break that occurs when a Canadian taxpayer deposits money into an RRSP retirement trust. The contribution amount can be deducted from the taxpayer's taxable income, thus reducing the individual's tax liability for the year.
Registered Retirement Savings Plan Deduction Limit - RRSP Deduction Limit
Registered Retirement Savings Plan deduction limit, or RRSP deduction limit, is a cap on the tax breaks allowed for contributions made to a RRSP Canadian retirement trust. Deduction limits are calculated from the taxpayer's annual income, with adjustments made for certain pension transactions and unused RRSP deductions from previous years. The RRSP deduction limit is listed on the taxpayer's Notice of Assessment.
Regulation G
Regulation G is legislation pertaining to loans made by lenders and other corporations to fund the purchase of securities. It was adopted by the Federal Reserve Board in 1968.