Credit_Study_Guide.doc

Credit Study Guide Personal Finance Define the following terms: Credit- Buy now, pay later Line of Credit Collateral- Offer something in return for the credit Secured Loan- Loan that is insured Due Date- Day a loan payment is due Layaway- Stores that offer instore credit Service Credit Installment Loan Credit History- A history of someone?s credit payments, etc Subscribers All of the Home Purchase Terms All of the Auto Purchase Terms Be able to answer the following questions What are the advantages and disadvantages of using credit? More spending power, higher standard of living Higher risk of ID theft, gathering debt What are the 5 C?s of Credit and define each one? What can be part of your credit history? Payment histories, divorces/alimonies, jobs, income, pretty much anything important What factors go into determining someone?s credit score and what percent does it contribute? What must be disclosed to each borrower in accordance with the Consumer Protection Act? If you lose your credit card, how much are you responsible for before you report it lost? How about after you notify the credit card company? Know how to calculate the following types of interest: Simple Installment Adjusted balance Previous balance Review and understand all the concepts on the auto and home purchase assignments. Review and understand all the ideas on the auto and home purchase tips handouts. Understand your rights and responsibilities when it comes to using credit cards. Understand all material from your notes and any other handouts you have received.