Types of loans

Multiple Choice

Closing an unused credit card would positively impact your credit score.

• True

• False

Multiple Choice

Responsibly using a credit card early in life will positively impact your credit score.

• True

• False

Multiple Choice

What is NOT calculated in your credit score?

• Payment history

• Amount owed

• Types of credit

• Location of credit

Multiple Choice

Where is the most used credit score from?

• Experian

• FICO

• TransUnion

• Equifax

Multiple Choice

All 4 of your credit scores should be the exact same.

• True

• False

Types of Loans

I can identify different types of loans explain how my credit score impacts my ability to get a loan

-A loan specifically meant to buy a house.

​-Collateral- The house acts as a collateral (if you don't pay, the bank takes your house)​

-Length: 10, 15, 20, or 30 years​

Look up average interest for each term.​

Mortgage

​

Multiple Choice

Based on what you know about loans, which is true about taking a 15 year loan over a 30 year loan?

• It will be more expensive overall and per month.

• It will be more expensive overall, but less expensive per month.

• It will be less expensive overall and per month.

• It will be less expensive overall but more expensive per month.

​-Equity- the amount your house is worth minus how much you owe

​-You borrow money against your house's worth

-Your house is the collateral

- Term (usually 10 or 20 years)

​

​

Look up average interest rate​

Home equity loan​

Open Ended

If your house is worth $250,000 and you owe $78,000, how much equity do you have?

Multiple Choice

A cause of the 2008 recession was that many people had negative equity (were "underwater"), what do you think that means?

• They owe more than their house than it is worth

• They don't owe anything on their house

• They owe exactly what the house is worth

• Their loan has been canceled by the government

-A loan to buy a car

-YOur car acts as the collateral on the loan

-May have 3-8 years terms​

​

Look up average interest rate for each term

Car loan​

​

Multiple Choice

Why would someone get an 8 year car loan instead of a 3 year car loan?

• They want cheaper monthly payments

• They want to pay less total interest

​-Money borrowed to pay for higher education

-There is no collateral required but you cannot ever get rid of student debt even if you declare bankruptcy

-Terms vary​

Look up average interest for student loans

Student loans

​

Open Ended

What are three other ways to pay for college besides student loans?

​​Loans for personal purchases besides homes and cars.

​

Collateral (such as a savings account) can make the loans less expensive.​

Personal loan

Can be used to pay for everyday items or larger purchases.

​

No collateral necessary. Paying off monthly will help you avoid paying interest. ​

Credit Card

Laon to start or expand a business.

​

Business usually acts as collateral. ​

Business

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Poll

What would you use: to pay for a new roof on your house?

• Home equity

• Credit card

• Personal

• Business

Poll

What would you use: to pay for an expensive medical bill?

• Home equity

• Credit card

• Personal

• Business

Poll

What would you use: to open a new location for your company?

• Home equity

• Credit card

• Personal

• Business

Poll

What would you use: to buy a playstation 5?

• Home equity

• Credit card

• Personal

• Business

Poll

What would you use: to open a new location for your company?

• Home equity

• Credit card

• Personal

• Business