The Cost of Credit

What are the costs associated with using credit cards or taking out loans?

• Finance charges, annual fees, transaction fees

• Interest rates, service charges, application fees

• Percentage rates, balance-transfer fees, over-limit fees

• Late payment fees, cash advance fees, risk of losing the asset

What does APR stand for?

• Annual Percentage Rate

• Annual Payment Requirement

• Average Purchase Rate

• Asset Protection Ratio

Which type of credit card fee can be avoided by choosing cards that do not have this fee?

• Finance charges

• Annual fee

• Transaction fees

• Late payment fees

What is the risk of losing the asset when using credit as collateral?

• Risk of losing the credit card

• Risk of losing the cash advance

• Risk of losing the asset purchased

• Risk of losing the annual fee

Which source of credit offers retail store credit cards with high-interest rates?

• Banks

• Credit unions

• Risk-based lending companies

• Finance companies

What are the benefits of using retail store credit cards?

• Lower interest rates, dispute rights

• Discounts, advance notice of sales

• Easy application process, credit history improvement

• Convenience, lower maximum loan amounts

Which type of bank specializes in lending to businesses?

• Commercial banks

• Investment banks

• Savings and loans

• Credit unions

What type of loans do banks offer for homes?

• Payday loans

• Title loans

• Mortgages

• Pawnshop loans

What is the main difference between credit unions and banks?

• Credit unions offer lower interest rates

• Banks offer lower maximum loan amounts

• Credit unions require membership

• Banks require collateral

Which type of lending companies offer payday loans?

• Banks

• Credit unions

• Risk-based lending companies

• Finance companies