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WorksheetsStudent Loan Debt
Total questions: 38
Worksheet time: 37mins
What percentage of higher-education students borrow to cover the costs of college/trade school?
Less than 30%
Between 30% and 45%
Between 45% and 60%
More than 60%
What is the second highest household debt?
Credit card debt
Mortgage debt
Auto loan debt
Student loan debt
What was the average student loan debt of the graduating class of a recent year?
$10,000
$15,000
$20,000
$28,500
What are career schools sometimes known as?
Colleges
Universities
Trade schools
Community colleges
What type of loan is issued by a bank, credit union, school, or state agency?
Federal loan
Private loan
Subsidized loan
Unsubsidized loan
What is the first thing you should do before obtaining any type of student loan?
Complete the FAFSA
Apply for scholarships
Research different lenders
Consult with a financial advisor
Before you obtain a student loan, what should you do after you have completed the FAFSA?
Beg for money
Apply for scholarships & grants
Research different lenders
Consult with a financial advisor
What is the expected family contribution (EFC)?
The amount of money a family is expected to contribute towards education costs
The amount of money a family is expected to save for retirement
The amount of money a family is expected to spend on vacations
The amount of money a family is expected to donate to charity
What type of federal loan allows students to defer interest payments while in school?
Federal Direct Subsidized Loan
Federal Direct Unsubsidized Loan
Federal PLUS Loan
Federal Perkins Loan
What type of loan is available for students with exceptional financial need?
Federal Direct Subsidized Loan
Federal Direct Unsubsidized Loan
Federal PLUS Loan
Federal Perkins Loan
What website is a great source for information on available financial aid?
www.studentaid.ed.gov
www.fafsa.ed.gov
www.collegeboard.org
www.scholarships.com
When does interest on a student loan accrue for federally subsidized loans?
While the student is in school and during the grace period
After the student graduates and starts repaying the loan
Only after the student starts making payments
Never, the interest is paid by the U.S. Department of Education
What is the term for adding accrued interest to the loan principal?
Interest deferral
Interest capitalization
Interest consolidation
Interest forgiveness
What happens if you choose to pay only the interest each month while in school?
The loan amount remains the same
The loan amount increases
The loan amount decreases
The loan amount is forgiven
What should you understand before choosing a loan?
The repayment options
The loan interest rate
The loan term
The loan origination fee
What type of interest rate is used for federal student loans?
Fixed rate
Variable rate
Prime rate
Depends on the lender
What type of interest rate is used for private student loans?
Fixed rate
Variable rate
Prime rate
Depends on the terms and conditions of the lender
What is the maximum amount of federal loan a student can borrow per year?
The maximum amount of federal loan a student can borrow per year is $50,000.
The maximum amount of federal loan a student can borrow per year is $10,000.
The maximum amount of federal loan a student can borrow per year varies depending on the student's grade level and dependency status.
The maximum amount of federal loan a student can borrow per year is $100,000.
What is the interest rate for federal loans?
The interest rate for federal loans is the same for all types of loans.
The interest rate for federal loans is fixed at 5%.
The interest rate for federal loans is determined by the borrower's credit score.
The interest rate for federal loans varies depending on the type of loan and the year it was disbursed.
What is the term for adding accrued interest to the loan principal?
deduction
capitalization
compounding
amortization
What is the average interest rate for private student loans?
The average interest rate for federal loans is 20%.
The average interest rate for federal loans is 0%.
The average interest rate for federal loans is 10%.
The average interest rate for private student loans varies depending on the type of loan and the year it was disbursed.
What is the most common type of federal loan?
Stafford Loan
Direct Consolidation Loan
PLUS Loan
Perkins Loan
What is the maximum amount of federal loan a student can borrow per year?
The maximum amount of federal loan a student can borrow per year is $10,000.
The maximum amount of federal loan a student can borrow per year is $50,000.
The maximum amount of federal loan a student can borrow per year is $100,000.
The maximum amount of federal loan a student can borrow per year varies depending on the student's grade level, dependency status, and whether they are considered an undergraduate or graduate student.
What is the maximum repayment period for federal student loans?
20 years
30 years
15 years
5 years
What is the difference between a fixed interest rate and a variable interest rate?
A fixed interest rate can change over time, while a variable interest rate remains the same throughout the loan term.
A fixed interest rate is higher than a variable interest rate.
A fixed interest rate is only available for short-term loans, while a variable interest rate is for long-term loans.
A fixed interest rate remains the same throughout the loan term, while a variable interest rate can change over time.
Before signing the promissory note for any loan, which should you do?
Consult a financial advisor
Read and understand the terms and conditions
Ignore the terms and conditions
Sign the dotted line immediately
What are career schools sometimes known as?
technical schools
professional schools
college preparatory schools
trade schools or vocational schools
What is the average interest rate for federal loans?
The average interest rate for federal loans varies depending on the type of loan and the year it was disbursed.
The average interest rate for federal loans is 10%.
The average interest rate for federal loans is 0%.
The average interest rate for federal loans is 20%.
What is the maximum amount of federal loan a student can borrow per year?
The maximum amount of federal loan a student can borrow per year varies depending on the student's grade level, dependency status, and whether they are considered an undergraduate or graduate student.
The maximum amount of federal loan a student can borrow per year is $100,000.
The maximum amount of federal loan a student can borrow per year is $50,000.
The maximum amount of federal loan a student can borrow per year is $10,000.
What is the term for adding accrued interest to the loan principal?
compounding
amortization
capitalization
deduction
What is the difference between a subsidized loan and an unsubsidized loan?
A subsidized loan is a loan where the government pays the interest while the borrower is in school or during other deferment periods, while an unsubsidized loan accrues interest from the time it is disbursed.
A subsidized loan is a loan that is only available to students with high credit scores, while an unsubsidized loan is available to all students.
A subsidized loan is a loan that does not accrue interest, while an unsubsidized loan accrues interest from the time it is disbursed.
A subsidized loan is a loan where the borrower pays the interest while the government pays the principal.
What is the average interest rate for private loans?
The average interest rate for private loans is 10%.
The average interest rate for private loans is 0%.
The average interest rate for private loans is 5%.
The average interest rate for private loans varies and cannot be determined without specific information.
What is the repayment period for private student loans?
2-10 years
10-30 years
1-5 years
5-20 years
What is the term for adding accrued interest to the loan principal?
amortization
compounding
deduction
capitalization
What is the very first thing you need to do before signing on the dotted line for ANY loan, including student loans?
Research Lenders
Consult a Financial Planner
Borrow Money from Family & Friends
Due Diligence
After the FAFSA is processed, what will you receive?
SAR (Student Aid Report)
SAR (Student Acquisition Rate)
SAR (Suspicious Activity Reports)
SAR (Students of America Report)
Which web address can you access the Free Application for Federal Student Aid?
To obtain federal student loans, the school you choose must be accredited and participate in the federal aid program.
True
FALSE
