Assessment

Front

Why is comparing loans confusing?

Back

Because there are so many types of loans, fees, interest rates, and term lengths.

Front

Which is not an example of a Closed-End Loan? Options: Mortgages, Credit Cards, Car Loans, Student Loans

Back

Credit Cards

Front

What is a financial asset?

Back

Collateral

Front

A type of loan that doesn't require collateral from borrowers but instead lenders rely on credit reports and credit scores.

Back

Unsecured Loan

Front

The price borrowers pay to use a lender's money.

Back

Interest

Front

What type of mortgage has interest rates that vary during the life of the loan?

Back

Adjustable Rate Mortgage

Front

True or False: Generally, the higher the credit score, the better the interest rate will be that is offered to a borrower.

Back

True

Front

True or False: A co-signer is not obligated to take over a loan payment if the borrower defaults on the loan.

Back

False

Front

True or False: Typical payday loans cost 400% APR or more.

Back

True

Front

Ashton needs to get his car fixed for $975 but lacks funds. Which option is likely the WORST financial decision? Options: Take out a home equity loan, Obtain a loan through a peer-to-peer lending website, Put the repair on his credit card, Take out a payday loan.

Back

Take out a payday loan