Vocabulary
Account Number
A unique number that identifies a credit card holder.
Fico Score
A score that summarizes the probability that a debtor will pay a debt and is a reliable way that creditors judge creditworthiness
What vocab term is "The interest rate you pay per year"?
Annual Percentage Rate
Credit Card Statement
An accounting of the credits and debits in the form of a monthly report sent to a credit card holder
A person's ability to earn money now and in the future
Earning Power
Down Payment
The upfront money applied to a purchase that is made using a loan (credit).
Monique buys a $5,300 air conditioning system using an installment plan that requires 15% down. How much is the down payment?
$795
Ray borrows B dollars over a 2 1/2- year period. The monthly payment is m dollars. Express his finance charge algebraically.
30m-b
Sheila's monthly periodic rate is 2.41%. What is her APR?
28.92%
Max is taking out a 5.1% loan in order to purchase a $17,000 car. The length of the loan is five years. Hoe much will he pay in interest?
$2295.40
Billing Cycle
A predetermined amount of time set by the credit card company that is used for calculating a credit card bill.
If Tanya purchased a $1700 set of golf clubs on a 9-month layaway plan and had to pay a monthly payment of $201, what is the sum of the monthly payments?
$109
Prepayment Penalty
An amount borrowers sometimes must pay if they wish to pay back an entire loan before the due date.
Available Credit
The difference between the maximum amount allowed and the actual amount owed on a credit card.
Rich had a previous balance of x dollars and made an on-time credit card payment of y dollars where y<x. He has a credit line of 10,000 dollars and will have to pay $15.50 in finance charges. Rich made a purchase totaling $1,300.30. Write an algebraic expression that represents his current available credit.
10,000-(x-y+1315.80)
Wage Assignment
A voluntary deduction from an employee's paycheck, used to pay off debts.
Layaway Plan
A method for purchasing merchandise whereas the customer makes periodic payments, usually monthly, towards the purchase price of merchandise. The merchandise is held at the store (sometimes for a fee) until all payments are made.
What is the monthly payment for a 10-year, $20,000 loan at 4.625% APR? What is the total interest paid on this loan?
$208.48; $5,017.60
Mrs. Cykman's credit card was stolen, and she did not realize for several days. The thief charged a $440 watch while using it. According to the Truth-in-Lending Act, At most how much of this is Mrs. Cykman responsible for?
$50
Balloon Payment
The last monthly payment on some loans that is much greater than previous payments.
Lending Institution
Organizations that extend loans, making their profit by charging interest; include banks, savings and loans, credit unions, consumer finance companies, life insurance companies and pawnshops.
Audrey purchases a riding lawnmower using a 2-year, no-interest deferred payment plan at Lawn Depot for x dollars. There was a down payment of d dollars and a monthly payment of m dollars. Express the amount of the last payment algebraically.
x-d-23m
Claire needs to borrow $12,000 from a local bank. She compares the monthly payments for a 5.1% loan for three different periods of time. What is the monthly payment for a two year loan?
$526.99
Luke has a credit line of $8,500 on his credit card. He had a previous balance of $4,236.87 and made a payment of $3,200.00, the total of his purchase is $989.42. What is Luke's available credit?
$6,473.71
Neville is considering taking out a $9,000 loan. He went to two lending institutions. Sunset Park Company offered him a 10-year loan with an interest rate of 5.2%. Carroll Garden bank offered him an 8-year loan with an interest of 6.6%. Which loan will have the lowest interest over its lifetime?
Sunset Park Company