Financial Literacy Quiz

Which of the following statements about payday loans is TRUE?

• Payday loans usually have low interest rates

• Payday loans do not have any additional fees like other types of unsecured loans

• Payday loans get borrowers into a sometimes inescapable cycle of borrowing money because of the high interest rates and fees

• To qualify for a payday loan you must have a checking account and excellent credit score

Why do lenders look at credit reports?

• To determine the size of your household

• To provide them with details about your savings account

• To decide whether you are a qualified or risky candidate for credit

• To edit your credit score

The following options are all included in your credit report trade lines except...

• Amount of money in your checking account

• Payment history

• Current balances on your loans

• When you opened your credit accounts

Why should you review your credit report regularly? Choose two correct answers.

• To monitor how different factors are impacting your FICO score

• To increase your credit views, which automatically increases your credit score

• To check your credit report for accuracy

• To open additional loans and lines of credit

What is the purpose of the FAFSA, or Free Application for Federal Student Aid? (Select 2 answers)

• It provides access to financial aid from the Federal government, such as grants, loans, and work-study.

• It is a scholarship application that is offered by the Federal government. If you win, you are awarded free tuition to the college you attend.

• Colleges and universities use the information you submit on the FAFSA to determine how much financial aid to offer you.

• It provides access to loan programs from private lenders.

True or False: Your parent/guardian can use your FSA ID to submit any information for your FAFSA application.

• True

• False

Which of the following statements is TRUE about filing the FAFSA?

• You should file the FAFSA for each year you will be in school.

• You only need to file the FAFSA if you received a tax refund.

• You only need to file the FAFSA if your parent/guardian's financial situation has changed.

• You only need to file the FAFSA if your financial situation has changed.

Why is it best to file the FAFSA as early as possible? (Select 2 answers)

• You have to pay to file the FAFSA once the Federal government receives a certain number of applications.

• Every college or university has its own FAFSA deadline. Filing early will help you meet all the deadlines.

• The longer you wait, the Federal government adds additional steps to the FAFSA filing process, such as writing essays.

• Financial aid is awarded on a first come, first served basis.

Which of the following does a college/university use to determine how much to award you in financial aid?

What is the benefit of having a fixed interest rate loan?

• Your interest rate changes annually, therefore, you may be able to get a lower rate

• Your interest rate stays the same, therefore, the amount of interest you pay stays the same

• Your interest rate changes, therefore, making this an easier loan to obtain

• Your interest rate stays the same, but the monthly payment on this type of loan changes drastically