Quiz about Everfi - Financing Higher Education: Modules 4 & 5

Question 1

What is considered by the federal government to be what your family will be able to pay per year toward your school expenses?

Accepted Answer

Expected Family Contribution (EFC)

Answer

Family Loan Savings Plan (FLSP)

Answer

Cost of Attendance (COA)

Answer

Projected Financial Aid Package (PFAP)

Question 2

financial aid letters from institutes of higher education show your aid and costs of attendance for

Accepted Answer

1 year

Answer

4 years

Answer

2 years

Answer

a semester

Question 3

If you are comparing the financial aid letters from two higher education institutions, how can you determine which one is more affordable?

Accepted Answer

Subtracting the financial aid offer from the cost of attendance will help you determine which one is more affordable.

Answer

The higher education institution that gives more financial aid will be more affordable.

Answer

The higher education institution that has a lower cost of attendance will be more affordable.

Answer

Adding the financial aid offer to the cost of attendance will help you determine which one is more affordable.

Question 4

The amount of money you will still need after subtracting scholarships, grants, and work study will help determine the amount of money _____.

Accepted Answer

you need to borrow in loans or pay out of pocket

Answer

to accept in grants and scholarships

Answer

to use for room and board, books and other expenses

Answer

to set aside in savings

Question 5

A percentage of the loan that is charged to cover the cost of giving the loan is known as _____.

Accepted Answer

an origination fee

Answer

a loan officer's fee

Answer

the administration fee

Answer

a higher education penalty

Question 6

Which type of interest can change over the life of a loan?

Accepted Answer

Variable interest

Answer

Fixed interest

Answer

Annual percentage rate (APR)

Answer

Principal interest

Question 7

Which type of interest does not change over the life of a loan?

Accepted Answer

Fixed interest

Answer

Variable interest

Answer

Annual percentage rate (APR)

Answer

Principal interest

Question 8

The _____ is the additional costs you pay each year in order to borrow money in loans, including both interest and fees.

Accepted Answer

annual percentage rate (APR)

Answer

origination fee

Answer

variable interest rate

Answer

fixed interest rate

Question 9

Which is an example of an income-driven repayment plan for student loans?

Accepted Answer

Payment amounts are based on a percentage of what you earn

Answer

Payments are the same every month for 10 years

Answer

Payments start lower and increase every 2 years

Answer

Payments are low and can last up to 25 years

Question 10

If Emmett wants to pay off his student loan by making monthly payments for 10 years, what type of repayment plan is best for him?

Accepted Answer

Standard repayment plan

Answer

Extended repayment plan

Answer

Graduated repayment plan

Answer

Income-driven repayment plan

Question 11

If Gabi wants to pay off her student loan by starting with a low amount and then increasing it every two years, what type of repayment plan is best for her?

Accepted Answer

Graduated repayment plan

Answer

Standard repayment plan

Answer

Extended repayment plan

Answer

Income-driven repayment plan

Question 12

Having a high debt-toincome ratio or defaulting on your loan can bring down your credit score. How can a low credit score on your credit report affect you?

Accepted Answer

It can make it much harder to borrow money in the future.

Answer

It can make it easier to get new credit cards.

Answer

It can make it harder to be accepted into graduate schools.

Answer

It can make it much easier to borrow money in the future.

Question 13

How could defaulting on a loan or having a high debtto-income ratio impact your future opportunities?

Accepted Answer

It can lower your credit score and make it difficult to borrow money for big purchases like a house or car.

Answer

It can improve your credit score and make it easy to borrow money for big purchases like a house or car.

Answer

There is no impact on future opportunities.

Answer

It can block affordable options in your searching algorithms.

Question 14

One consequence for defaulting on a student loan is loan acceleration. What does this mean?

Accepted Answer

You owe the amount of your loan and interest immediately.

Answer

You must pay the loan back twice as fast.

Answer

Bill payment is required every week.

Answer

You must prepay all the interest on the loan now.

Question 15

One consequence for defaulting on a loan is to have your wages garnished. What does this mean?

Accepted Answer

Money is taken directly out of your paycheck to cover your debt.

Answer

When you get a raise or increased wages, your loan payments will also increase.

Answer

A garnish is a bonus payment that you need to make in order to get out of default.

Answer

A garnish is an additional tax that will be paid to the state as a criminal penalty for defaulting on your loan.

Question 16

Which of the following is not true if you default on a student loan?

Accepted Answer

You will have your degree taken away.

Answer

You may not be eligible for additional financial aid for future studies.

Answer

You may be taken to court and have to pay all fees.

Answer

You may have money taken directly out of your paycheck to cover your debt.

Question 17

What happens when you refinance a student loan?

Accepted Answer

A lender pays off your existing loan and offers a new loan with a different interest rate, payment schedule and terms.

Answer

You apply for the loan a second time if you are denied for any reason.

Answer

You choose a new interest rate and payment schedule to better fit your ability to pay.

Answer

The lender makes you submit your application again since it was not completed accurately.

Question 18

Which of the following may not make you eligible for loan forgiveness?

Accepted Answer

Being in an entry-level position for 2-3 years

Answer

Having a qualifying public service job like working in government or in a non-profit for 10 years

Answer

Teaching in a low-income public school for 5 years

Answer

Being on an income-driven repayment plan for 20 or 25 years

Question 19

Opportunities to reduce or wipe away part of a loan amount based on your years of paying the loan or years of employment in a specific job

Accepted Answer

forgiveness programs

Answer

deferment programs

Answer

default programs

Answer

refinance programs

Question 20

When creating a budget to repay your student loans, what do you need to pay in order to fully pay it off?

Accepted Answer

Principal and interest

Answer

Interest only

Answer

Principal only

Answer

Application fees

Question 21

Taking care of your _____ first is a good budgeting strategy that includes covering your loan payments.

Accepted Answer

needs

Answer

investments

Answer

wants

Answer

savings

Question 22

True or false? When creating a budget to repay your student loans, you can save money by paying only the interest.

Accepted Answer

False because paying only interest lengthens the life of the loan and increases the total amount you pay in the long-term.

Answer

True because paying only interest means monthly payments will be small.

Answer

False because it is not possible to only pay the interest.

Answer

True because paying only the interest reduces the total amount you pay in the long-term.

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