Costly Credit
When purchasing a car, you might use this less complex formula of interest
What is Simple Interest Formula ?
The initial amount of money borrowed
What is Principal?
A that law protects you from discrimination when taking out a loan.
What is the Equal Credit Opportunity Act?
Making payments on time and making more than the minimum payment
What is a way to improve your credit score?
Your wallet is stolen!
What is identify theft?
This form of interest might seriously add if you're unwise with your credit card.
What is compound interest?
Your ability rating to borrow and use credit
What is credit score?
Economists suggest this rule, that states that you should maintain a debt at a certain percentage of your income, as well as your monthly payments.
What is the 20-10 Rule?
Equifax, Experian and Transunion
What are credit reporting agencies?
This specific age group is at most risk for identity fraud among the youth.
What are 15-18 years old?
When repaying student loans, you would use this formula to calculate your monthly payments.
What is the amortization formula?
A fine/charge occurred as a result of paying off your loan 1 year early.
What is prepayment penalty?
It is required that the lender give the borrower 45 days notice before raising the interest rate.
What is a responsibility of the lender?
These valuables of your own might be used to help you qualify for a loan
What is an asset?
Keeping your wallet light and shredding ruthlessly
What are tips to prevent/protect against identity theft/fraud?
You take out a loan for a new car at $30,000. You must repay this loan in 5 years with 5% interest. This would be your monthly payment.
What is $625?
30,000 (P) x .05 (I) x 5 (Y) = $7,500 (total int.)
30,000 (P) + $7,500 (TI) = $37,500 (T.A.P)
$37,500 (T.A.P) / 60 (M/5 years) = $625 (M.P)
A specific amount of money borrowed for an item, to be repaid at a later date, often monthly.
What is Installment Credit?
The lender is entitled to a 10 day grace period without a late fee or increased interest rates.
What is a right of the borrower?
Your full legal name, address, birth date, social security number and others
What are credit application requirements?
Your account information is used for purchases
What is identity fraud?
You spend $500 on your credit card. You make the minimum payment of $25 by the end of the billing cycle. Your interest rate is 14%. You owe this amount.
What is $541.50?
$500(P) - $25(Min.) = $475 (carry over)
$475(Bal.) x .14 (I) = $66.50 (T.I)
$475 (Bal) + $66.50 (T.I) = $541.50
A possession you give up to the bank for not paying your loan
What is Collateral?
A federal law that regulates credit reporting agencies and compels them to insure the information they gather and distribute is a fair and accurate summary of a consumer's credit history
What is the Fair Credit Reporting Act?
What is 300 to 850
This company makes these important suggestions regarding fraud
Deter misuse of your information
Detect when you have a problem
Defend yourself from loses
What is the Federal Trade Commission?