Help
Options
Didn't know it?
click below
click below
Knew it?
click below
click below
Don't Know
Remaining cards (0)
Know
retry
shuffle
restart
0:00
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
Finances ch 4
| Question | Answer |
|---|---|
| Debit is the most aggressively marketed product ___. | Ever |
| Visa, Mastercard, Discover, and American Express spend over ___ a year on marketing alone. | $4 Billion |
| There were no credit cards prior to ___. | 1958 |
| Debt | Money owed to another person or company. |
| What do half of all major credit cards allow? | Allows parents to let their children use their credit card. Some impose an age minimum of 13-16 years, but others don't. |
| What is Credit? | A big business item the makes lots of money for credit card companies. |
| When a lender offers you credit through something, what are they essentially doing? | They're offering you the opportunity to borrow their money. |
| Credit Card companies make their biggest profits when? | When people carry a balance from one check to the next. |
| What is Introductory Rate? | Credit with low or zero interest time period, temporary. |
| What people under 18 cannot do? | They cannot legally get their own credit card. Ages 18-21 may need a cosigner and proof of income first. |
| ___ credit is when you have to put down a security deposit or use something as collateral. | Secured |
| ___ credit is when the lender doesn't require you to put down a security deposit or collateral. | Unsecured |
| ___ credit is how most credit cards work. | Revolving |
| ___ credit is when there’s an agreement or a contract that puts you on a schedule of payments. | Installment |
| Myth: You need a student ___ to go to college. | Loan |
| Truth: You can go to college ___. | Debt-Free |
| What percentage of Americans have a credit card? | 80% |
| Revolving Credit | Credit that automatically renews whenever a payment is made to reduce the debt. |
| Collateral | Something owned (that has value) offered as security on a debt; if the debt is not repaid as agreed, the item is forfeited to the lender. |
| What do Personal loans come with? | Higher interest rates and fees. |
| Lien | A legal claim against (or right to own) an asset until the debt (loan) is required. |
| Appreciating Asset | An asset that increases in value over time. |
| Equity | The increase in value of a home over time; the difference between the amount owned and what the home could be sold for. |
| Default | Failure to repay a loan on time. |
| How much times does a mortgage loan last? | 15-30 years |
| How can owners buy their equity? | With a home equity loan or a home equity line of credit. |
| What is a student loan? | Money borrowed by the federal government. |
| Installment Credit | A loan for a fixed amount of money that's paid back in monthly installments. |
| Deprecating Asset | An asset that loses value over time, such as a car that's worth less every year. |
| Predatory Lender | A lender who uses deceptive, unfair, or fraudulent practices on borrowers who are desperate for cash. |
| How many cars are purchased and borrowed with money? | Almost 90% |
| What is a Credit Score? | A three-digit number that tells banks and lenders how likely someone is to repay debt. |
| What is a FICO Score? | Simply a person's credit score that's calculated with software from the Fair Isaac Corporation (FICO). It's a score most lenders use. |
| What is Credit Bureaus? | Agencies that gather information about your credit history and sell it to creditors who decide if they will lend money to you. |
| What's all a FICO score really says? | How good you are at making payments to lenders, all about debt. |
| When was FICO founded? | In 1956 by Bill Fair and Earl Isaac. |
| Myth: I need a ___ card to rent a car and make purchases online. | Credit |
| Truth: You can both rent a car and make purchases online with a ___ card. | Debit |
| Most credit cards will charge you an ___ fee. | Annual |
| Credit Card companies make most of their money from three things: | Interest, Cardholder fees, and Credit Card transaction fees from businesses. |
| Interest Charges | You'll have more interest if you're younger buying with a credit card. |
| Cash Advance Fee | A loan you take with a credit card, a withdrawal with interest. Higher interest rate with a finance fee. |
| What happens every time a credit card is used to buy something? | The credit card company charges the store or merchant a 1-2% processing fee built into the prices. |
| When you buy with credit... | You spend more money. |
| The only thing you can't do with a credit card is to.. | Go into debt. |
| Myth: Car ___ are a way of life. | Payments |
| Truth: To avoid car ___ now and always. | Debt |
| The average new car payment in America is ___ a month. | $554 |
| What are two major ways to finance a car? | Direct financing (a loan) and leasing. |
| Principal | The original amount of a loan; the total amount borrowed before interest. |
| Interest | The additional cost a lender charges for borrowing their money. |
| Term | The amount of time, in months, that you'll be making payments. |
| Depreciation | The loss of value of an asset over time. |
| Negative Equity | When the value of an asset galls below what is owed on it. |
| What percentage of loans for new cars are for over 60 months and what is the average new car loan? | 70% averaging 69 months. |
| The third Foundation | Pay cash for your car. |
| Say ___ to going to debt about matter what | No |
| Pay off all debt using the debt ___. | Snowball |
| Paying off debt is not a math problem, it is a ___ problem. | Behavior |
| The debt snowball is a ___ process. | Proven |
| The First Foundation | Save a $500 emergency fund |
| What do you do when you have debt and a car payment? | Sell the car to get rid of the debt then use that money to to pay cash for an affordable used car. |
| What is the Snowball Method? | Steps of how to get out of debt: List them from biggest to smallest, attack the smallest absolutely, then every time you pay off a debt, add the amount you were paying on that debt to your next payment, then repeat this method. |
Created by:
user-2005084