Business Lending
What is the amount of money a borrower receives from a lender and agrees to repay?
What is a loan principal?
What does CDFI stand for?
What is Community Development Financial Institution?
What is the upfront amount a homebuyer typically pays toward the purchase price of a home?
What is a down payment?
What three-digit number is commonly used by lenders to help evaluate a person's credit risk?
What is a credit score?
What is the amount left after subtracting expenses from revenue?
What is profit?
What do we call the percentage charged by a lender for borrowing money?
What is an interest rate?
What is one major purpose of a CDFI?
What is providing financial services and capital to underserved communities?
What is the loan used to purchase a home called?
What is a mortgage?
What is the amount of money someone owes on a credit card or loan called?
What is the balance?
What are the three major financial statements commonly used to understand a business's financial health?
What are the Income Statement, Balance Sheet, and Cash Flow Statement?
What document outlines a borrower's expected income, expenses, and financial performance for a business
What is a business plan?
Unlike many traditional lenders, CDFIs often provide more than just loans. Name one service they may provide to borrowers.
What is technical assistance, financial education, business coaching, or financial counseling?
What is the difference between what a home is worth and the amount still owed on the mortgage?
What is home equity?
What is the percentage of available revolving credit that a person is currently using?
What is credit utilization?
If a business has $100,000 in assets and $60,000 in liabilities, what is its owner's equity?
What is $40,000?
Assets − Liabilities = Equity
What is the term for property or an asset pledged to a lender to secure a loan?
What is collateral?
What federal agency certifies and oversees CDFIs through the CDFI Fund?
What is the U.S. Department of the Treasury?
Property taxes, homeowners insurance, and mortgage principal and interest are common components of what monthly housing expense?
What is a mortgage payment / housing payment?
This is the total cost of borrowing money, expressed as a yearly percentage and including certain fees and interest.
What is the Annual Percentage Rate (APR)?
What is the difference between revenue and cash flow?
Revenue is income earned from business activities, while cash flow measures money actually moving into and out of the business.
A borrower has $50,000 in annual cash flow available for $40,000 in annual debt payments. What financial ratio measures the borrower's ability to cover those debt payments?
What is the Debt Service Coverage Ratio (DSCR)?
Native CDFIs primarily focus on increasing access to capital and financial services within what communities?
What are Native communities and Native/Indigenous populations?
A homeowner owes $120,000 on a home worth $200,000. How much equity do they have?
What is $80,000?
This is why making only the minimum payment on a credit card can result in paying much more than the original purchase price.
What is interest accumulating on the unpaid balance?
A business has $200,000 in assets, $150,000 in liabilities, $100,000 in annual revenue, and $20,000 in annual profit. What is its owner's equity?
What is $50,000?
$200,000 − $150,000 = $50,000