Creditor

A creditor is a party (e.g. person, organization, company, or government) that has a claim to the services of a second party. The first party, in general, has provided some property or service to the second party under the assumption (usually enforced by contract ) that the second party will return an equivalent property or service. The second party is frequently called a debtor or borrower .

Simply put, creditors are people to whom someone owes money.

The term creditor is frequently used in the financial world, especially in reference to short term loans , long term bonds , and mortgages. In law, a person who has a money judgment entered in their favor by a court is called a judgement creditor.

The term creditor derives from the notion of credit . In modern America, credit refers to a rating which indicates the likelihood a borrower will pay back his or her loan. In earlier times, credit also referred to reputation or trustworthiness.

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This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Creditor".