Unit 4 Credit and Loans

Type of credit that allows qualified customers to buy merchandise without paying in cash at a store.

• Charge Account

• Installment Plan

• Loans

• Credit Cards

Official lending of a sum of money from a bank, finance company, or credit union for a specified purpose.

• Charge Account

• Installment Plan

• Loans

• Credit Cards

___________ credit is a one-time advance of a sum of money; _______________ credit is an assigned maximum amount you can borrow, which you can use as little or as much as you want.

• Closed-end, Closed-end

• Open-end, Open-end

• Open-end, Closed-end

• Closed-end, Open-end

__________ term loans mean higher monthly payments, but less interest paid out by the end of the loan.

• Shorter

• Longer

• Medium

• None of the above

____________ term loans mean lower monthly payments, but more interest paid out by the end of the loan.

• Shorter

• Longer

• Medium

• None of the others

______________ rates can change during the duration of the loan; ___________ rates will not change.

• Fixed, Variable

• Variable, Fixed

• Volatile, Consistent

• Consistent, Volatile

All of the following are advantages of using credit EXCEPT

• Buy and enjoy things now

• Can cost more than cash purchases

• Deal with financial emergencies

• Make purchases without having to carry cash

Interest rate you would be charged over a year.

• Annual Fee

• APR

• Introductory APR

• Penalty APR

Money you pay for a payment not being able to be processed correctly (ie.: due to a bounced check or insufficient funds).

• Late Payment Fee

• Returned Payment Fee

• Cash Advance

• Balance Transfer

Amount of money you pay each year for the privilege of having a particular credit card.

• Annual Fee

• APR

• Late Payment Fee

• Cash Advance