Loans, Credit and Credit Card Test

What is the difference between revolving credit and installment credit?

• Revolving credit has a fixed payment schedule while installment credit renews automatically

• Revolving credit renews automatically while installment credit has fixed payments

• They are the same thing with different names

• Neither type of credit requires monthly payments

What is an appreciating asset

• An asset that increases value over time

• An asset that loses value over time

• an original amount of a loan or asset

• None of the answers

What is a depreciating asset

• An asset that increases value over time

• An asset that loses value over time

• an original amount of a loan or asset

• None of the answers

What is collateral when using for loans?

• A type of credit score

• The monthly payment amount

• An asset that secures the loan

• None of the other answers given

Which term describes the difference between what you owe on your home and what you could get from the current market value

•  Lien

• Equity

•  Interest

• Answer not given

The additional cost of borrowing money you need to pay is called

•  Lien

• Equity

•  Interest

• Answer not given

A legal claim against (or right to take/own) an asset until the debt is repaid, usually put on homes.

•  Lien

• Equity

•  Interest

• Principal

What factor most heavily influences a credit score?

• Payment history

• Current salary

•  Education level

• Age

The length of time you have to repay a loan is called the

• Depreciation

• Lien

• Principal

• Term

• Answer Not given

What is debt

• Money saved for future use

•  Money invested in stocks

• Money owed to others

• Money earned from work