Tips and Tools For Financial Success - Newton Free Library

Borrowing Basics Quiz
1. Which of the following places offer car loans?
a. Finance companies
b. Credit unions & Thrifts
c. Car dealerships and banks
d. All of the above
2. Which of the following might be a condition to obtain a low interest rate from a dealer?
a. Paying a participation fee
b. Making a large down payment
c. Having an excellent credit history
d. All of the above
3. The formula used to calculate home equity is:
a. Equity = the current market value of the home plus the outstanding debt
b. Equity = the current market value of the home minus the outstanding debt
c. Equity = the price you paid for the home
d. None of the above
4. The 4 Cs of loan decision making are:
a. Cash, Credit, Car type, and Convenience
b. Consumer, Credit card, Co-signer, and Credit Union
c. Credit History, Customer Service, Compounding, and Cash Deposit
d. Capacity, Capital, Character, Collateral
5. Which of the following items are not usually purchased with an installment loan?
a. Cars
b. Food and Beverages
c. Furniture
d. Household appliances and computers
6. Security that you provide a lender by pledging an asset that you own is called:
a. APR
b. Compensation
c. Collateral
d. Installment loan
7. Making equal payments over a period of time is an example of:
a. An adjustable rate mortgage
b. A fixed-rate installment loan
c. A home equity line of credit
d. None of the above
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