Loans
What does a payday loan NOT check when you are applying for a loan?
Credit score
What is the amount of lines of credit Ms. Young recommends you have?
3
What does APR stand for?
Annual percentage rate
What is the interest rate of a payday loan
400% +
Secured loans are backed by
collateral
An excellent credit score helps you qualify for this when financing a car.
Low interest rate
The total amount of money you can borrow is called what?
Credit limit
High credit scores give you higher or lower interest rates?
lower
What is a fixed rate loan mean?
Interest rate stays the same the entire loan term
Since unsecured loans are not backed by collateral, they typically have what instead? Hint: High
High interest rates
If you don't make payments on a secured loan, the lender can do this to the item.
Repossess it
What is the best way for him to improve your credit score with a credit card?
Make on-time payments
The actual amount of money you borrow from the lender
Principal
Number that determines how financially responsible you are
Credit score
What is one alternative to pay day loans
1. Ask creditor for more time to repay them
2. Try to get a loan from a credit union
3. Visit a community bank
4. Check with local branches of large banks in your area
5. Use your tax refund
6. Get managing debt
7. Ask family and friends for help
8. Contact local charities and churches
The 25-day period after the billing cycle ends before interest is charged is called this.
Grace period
This is the ONLY way to avoid interest charges on a credit card.
What is making full payments on-time every month?
When you need to apply for a loan but need help getting a better interest rate, what may you do?
Get a co-signer
Assets - liabilities = _______
Net worth
Short term - high cost loans used for emergencies
Pay day loans
This is the process of spreading out a loan of an intangible assest over a specific period through regular payments.
Amortization
Your credit report is sent to these people and they decide if your credit score goes up or down
Credit bureau
What is an authorized user on a credit card?
An authorized user is an individual permitted to make purchases on another person's credit card account without being legally liable for the debt.
When loans are amortized, monthly payments are _______
Constant or variable
Constant
Why it's often a good idea to pay more than the monthly amount due on an loan?
The extra payment will be applied to the principal amount you owe, which will pay down your debt more quickly