Chapter 8-Preserving Your Credit
Section 8-2:
Terms:
1.Down payment:
2.Trade-in:
3.Preapproved loan:
4.Car lease:
5.Refinancing:
6.Appreciating:
7.Market Value:
8.Equity:
9.Mortgage:
10.Balloon payment:
12.rent-to-own-agreement:
13.Prepayment penalty:
Questions:
1.What is long-term debt? Give examples.
2.What is amortization?
3.What is an installment loan?
4.How is a car loan typically set up? How does a down payment affect the car loan?
5.How does a trade-in affect a car loan?
6.What does it mean when a car “depreciates”?
7.What does it mean to have an upside-down loan?
8.What is a preapproved loan?
9.What are some common loan terms? How is the loan affect with a longer term?
10.What is a car lease? What are the terms? Why would you want to lease a car rather than buy?
11.Explain what happens when you pay on a loan.
12.What is refinancing? What is involved in refinancing?
13.What does it mean when a house is “appreciating”?
14.What is equity?
15.What are some advantages to owning a home?
16.What are the options for financing a house?
a.Conventional loan
b.FHA loan
17.What are closing costs?
18.What is a fixed-rate mortgage?
19.What is an adjustable-rate mortgage?
20.What is a debt repayment plan?
21.Student loan debt:
a.deferred-payment loan
b.Subsidized student loans
c.Unsubsidized student loans
22.What does it mean to consolidate your loans?
23.What is “loan forgiveness”?
24.What are some options for a mortgage loan term? Why would you want a shorter term?
25.What is a balloon payment? When is it due? How does it affect a mortgage loan?
26.What are the terms of a rent-to-own agreement?
27.What are some things that can be purchased with a rent-to-own agreement?
28.What is “right of first refusal”?
29.What happens if you decide not to purchase a personal property item?
30.What is the main disadvantage to a rent-to-own agreement?
31.What is a prepayment penalty? What are the terms of it?
32.What are some advantages of paying off a debt early?