vocab
A person’s property or what is owned
assets
Heather wants to purchase an electric guitar. The price of the guitar with tax is $2,240. If she can save $90 per month, how long will it take her to save up for the guitar?
25 months
A method of payment of a purchase or services over a period of time
installment plan
Hannah is taking out a 4.3% loan to purchase an $18,000 car. The length of the loan is 8 years. How much will she pay in interest
$6,984
8 ÷ 2 ( 2 + 2 ) = ?
16
The last monthly payment on some loans that is much greater than the previous payments
balloon payment
What is the monthly payment for a $4,000 2-year loan with an APR of 4%? The monthly cost per thousand dollars borrowed is $43.42. You are borrowing four sets of $1,000
$173.68
A numerical value that indicates how well a user of credit meets financial obligations; these records are used by creditors when they decide to issue credit
Credit rating
Charlie and Kathy want to borrow $20,000 to make some home improvements. Their bank will lend them the money for 10 years at an interest rate of 5.75%. How much will they pay in interest?
$11,500
6 ÷ 2 ( 1 + 2 ) = ?
9
A need-based student loan for which borrowers can defer interest payments for a period of time
Federal Direct Subsidized Loan (Stafford)
She has to make 2 years (24 months) of monthly payments of $88.75. what is the sum of the monthly payments that is found by multiplying the number of payments by the monthly payment amount.
$2130
A person that signs a promissory note along with the borrower and agrees to pay back the loan if the borrower does not
cosigner
What is the total interest on a 10-year, 6.1% loan with a principal of $32,000?
$19,520
9 - 3 ÷ 1/3 + 1 = ?
1
The form on which a loan applicant must supply personal and financial data that will assist in the loan decision-making process
Free Application for Federal Student Aid (FAFSA)
find the average daily balance, add all the daily balances and divide by the number of days in the billing cycle, 31. The sum of the daily balances is $26,488.30
$854.46
An amount borrowers sometimes must pay if they wish to pay back an entire loan before the due date
Prepayment penalty
Jennifer wants to borrow $20,000. Her bank offers a 7.1% interest rate. She can afford $500 a month for loan payments. What should be the length of her loan to the nearest tenth of a year?
5.1 years
5 x ( 6 + 4 ) - 1 = ?
49
Formula that employs both algebraic manipulations and the properties of logarithms to solve for time
loan length formula
Determine the total interest owed on a 5-year, $10,000 loan at 6% APR
$193.33
The form on which a loan applicant must supply personal and financial data that will assist in the loan decision-making process. FAFSA is a federal form, but many private educational and lending institutions also require it
Free Application for Federal Student Aid (FAFSA)
Dave wants to borrow $22,000 from First Finance Bank. The bank will give him a 15-year loan at an interest rate of 4.85%. How much will he pay the bank in interest over the life of the loan? Round to the nearest hundred dollars.
$18,300
33 + 4 ( 8 - 5 ) ÷ 6 = ?
29