Credit, Mortgage, and Car Loan Worksheet

Which of the following is a key benefit of using a credit card responsibly?

• Avoiding all debt

• Building a positive credit history

• Earning unlimited cash back without any fees

• Guaranteeing financial wealth

What is the term for the maximum amount you can charge on your credit card?

• Annual Percentage Rate (APR)

• Minimum payment

• Credit limit

• Available balance

Making only the minimum payment on your credit card each month will generally result in:

• Paying off your balance quickly

• Paying significantly more interest over time

• Improving your credit score rapidly

• Lowering your credit limit

What is a mortgage?

• A type of unsecured personal loan

• A loan specifically used to finance the purchase of real estate

• A short-term loan for home repairs

• A government grant for first-time homebuyers

Which of the following is typically required by a lender as a down payment on a conventional mortgage?

• 0% of the purchase price

• 5% to 20% of the purchase price

• 50% of the purchase price

• The full purchase price

Tags

CCSS.6.RP.A.3B

What does "amortization" refer to in the context of a mortgage?

• The insurance that protects the lender

• The process of paying off the loan principal and interest over time

• The fee charged for processing the loan application

• The legal document that transfers property ownership

What is the primary difference between a secured and an unsecured loan, like a car loan?

• Secured loans have lower interest rates.

• Secured loans are backed by an asset (the car)

A longer car loan term generally results in:

• Lower monthly payments but more total interest paid

• Higher monthly payments and less total interest paid

• The same total interest paid regardless of the term

• A better interest rate

What happens if you default on your car loan?

• Your credit score will not be affected.

• The lender can repossess the vehicle.

• You will receive a full refund of all payments made.

• The loan will be forgiven.

When you lease a car, you are essentially:

• Buying the car outright.

• Paying for the right to use the car for a specific period.

• Borrowing money to purchase the car.

• Receiving the car as a gift from the dealership.