3.1-3.2 Vocab Quiz Review

Organization or person who uses credit.

• Debtor

• Creditor

• Debit

• Credit

Organization or person who extends credit to debtors

• Creditor

• Debtor

• Debit

• Credit

Match the following

• Credit Rating

• A numerical value that indicates how well a user of credit meets financial obligations; these records are used by creditors when they decide to issue credit.

• Credit Reporting Agency

• A person’s property or what is owned.

• Asset

• Organizations that compile records on users of credit as to how well they repay their debts.

• FICO Score

• A score that summarizes the probability that a debtor will pay a debt and is a reliable way that creditors judge creditworthiness.

• Installment Plan

• A method of payment of a purchase or services over a period of time

Tags

CCSS.HSS.MD.B.5

Match the following

• Cosigner

• The interest that is charged to a buyer when paying for a purchase or service over time.

• Finance Charge

• Describes the situation when a borrower fails to make payments according to the schedule set up when the loan originated.

• Deferred Payment Plan

• The upfront money applied to a purchase that is made using a loan (credit).

• Down Payment

• Requires the borrower to make periodic payments but no interest is charged if the payments are made on time.

• Default

• A person that signs a promissory note along with the borrower and agrees to pay back the loan if the borrower does not.

Security, such as a personal belonging, car or boat title, CD, or stock certificates, that insures a loan will be repaid.

• Secured Loan

• Unsecured Loan

• Collateral

• Default

Match the following:

• Prepayment Penalty

• An agreement that allows a borrower to make payments before the due date to reduce the amount of interest.

• Consolidating

• is to combine assets, liabilities, and other financial items of two or more entities into one.

• Unsecured Loan

• An amount borrowers sometimes must pay if they wish to pay back an entire loan before the due date.

• Secured Loan

• is a loan that doesn't require any type of collateral.

• Prepayment Privilege

• business or personal loans that require some type of collateral as a condition of borrowing.

a relatively small amount of money lent at a high rate of interest on the agreement that it will be repaid when the borrower receives their next paycheck.

• Payday Loan

• Secured Loan

• Unsecured Loan

• Installment Plan

Interest rate remains constant during the duration of the loan.

• Fixed Rate

• Variable Rate

• Balloon Payment

• Wage Garnishment

Tags

CCSS.HSF.LE.A.1

Interest rate can change during the duration of the loan.

• Fixed Rate

• Variable Rate

• Balloon Payment

• Wage Garnishment

An installment loan is...

• used to finance a specific purchase for a specific amount of time

• a relatively small amount of money lent at a high rate of interest

• a business or personal loan that requires some type of collateral

• a loan that doesn't require a cosigner