Car/House Loans
What is MSRP?
The price of the car
Which of the 4 repayment plans discussed in class gives extra time for payments?
Extended Payment Plan
Are federal or private loans more likely to be forgiven?
Federal
Private student loans come from ______
Banks and Credit Unions
Experts recommend a ____% down payment for cars and houses.
20%
Which of the 4 repayment plans discussed in class has equal payments each month?
Fixed monthly payment plan
When a loan term is increased, what happens to the monthly payments?
The payments go down per month.
Federal student loans come from ______.
The government
What is the purpose of a co-signer for a loan?
That person is responsible for the loan if the borrower does not make payments
Which of the 4 repayment options discussed in class bases your payment off of the amount of money you earn?
Income-based payment plan
What is the difference between the "principal" and "interest" on a loan?
Principal - Borrowed amount of money
Interest - The cost of borrowing
This type of student loan does NOT gain interest while you are in school
Direct Subsidized
When looking for a car/house, it is a good idea to get ______ by your bank for a certain amount. This shows that the bank will give you a specific amount of money.
Pre-approved
Which of the 4 student loan repayment plans discussed in class increases the payment amount every 2 years?
Graduated payment plan
What is the purpose of a down payment when taking out a major loan?
To reduce the amount of the loan and show the buyer's commitment
This type of student loan is offered directly to parents of undergraduates
Direct PLUS
You've received a bonus at work and are considering making an extra payment on your loan. What would be the primary benefit of doing this?
Reducing the overall interest paid over the entire loan
When are payments required to begin for student loans? (No payments until ______ or ________)
No payments until 6 months after graduation OR you fall under half time enrollment
How do you calculate the true cost of a loan? (How much it costs YOU) (_____+_______+______)
This type of student loan charges interest while in school. You should pay the interest while in school to keep the cost down.
Direct Unsubsidized