3.1 Credit Basics Due (10/7/22 SoC)

Last updated about 1 year ago

23 questions

Note from the author:

In this lesson, you will learn to:
Correctly use fundamental vocabulary related to credit and lending
Explain how loan amortization and payments work
Understand how principal, interest rate, and term are critical components to evaluating credit options

Instructions

In this lesson, you will learn to:
Correctly use fundamental vocabulary related to credit and lending
Explain how loan amortization and payments work
Understand how principal, interest rate, and term are critical components to evaluating credit options

Required

3.1 Credit Basics Due (10/7/22 SoC)

Last updated about 1 year ago

23 questions

Note from the author:

In this lesson, you will learn to:
Correctly use fundamental vocabulary related to credit and lending
Explain how loan amortization and payments work
Understand how principal, interest rate, and term are critical components to evaluating credit options

Instructions

In this lesson, you will learn to:
Correctly use fundamental vocabulary related to credit and lending
Explain how loan amortization and payments work
Understand how principal, interest rate, and term are critical components to evaluating credit options

Required

Have you ever borrowed from or lent money to someone? (UCS)

Required

Who did the loan involve?

Required

Did it work out the way you anticipated? Were both people happy at the end? (UCS)

Banking Explained – Money and Credit
Publisher: In a Nutshell - Kurzgesagt

Required

What is the relationship between people who save money in banks and people who borrow money from banks? (UCS)

Required

How does the bank make a profit? (UCS)

What is Credit? Loans, Mortgages, and Overdrafts explained
Watch this video and answer the questions on the right.

Required

What are the main advantages to a secured vs. unsecured loan? (UCS)

Required

What factors determine interest rates? (UCS)

Required

Understanding How Loan Payments Work
When loan payments are amortized, the total amount you owe every month remains constant

Required

Why does the amount of INTEREST you owe decrease every month? (UCS)

Day 2 

ANALYZE: Understanding Amortization

Part I: Categorize Different Types of Credit

For each TYPE OF CREDIT listed in the first column, you’ll categorize it in the remaining three columns, using the following descriptions:

If you’re unsure where a type of credit belongs, you can use these links as a resource:
Types of Consumer Credit & Loans -  Debt.org
The Difference Between Secured and Unsecured Debts - About Money
What Is the Difference Between Fixed- and Variable-Rate Financing? - CFPB
If you can’t find the answer using the links above, you can do your own internet search to help you complete the work.

Required

Classify each Type of Credit. For each TYPE OF CREDIT listed in the first column, you’ll categorize it using the corresponding abbreviations.

TYPE OF CREDIT:

Auto Loan  
Installment Loans vs Revolving Credit__________

Secured vs Unsecured Debt __________

Variable vs Fixed Rate __________

Required

Classify each Type of Credit. For each TYPE OF CREDIT listed in the first column, you’ll categorize it using the corresponding abbreviations.

TYPE OF CREDIT:

Credit Card  
Installment Loans vs Revolving Credit__________

Secured vs Unsecured Debt __________

Variable vs Fixed Rate __________

Required

Classify each Type of Credit. For each TYPE OF CREDIT listed in the first column, you’ll categorize it using the corresponding abbreviations.

TYPE OF CREDIT:

Mortgage
Installment Loans vs Revolving Credit__________

Secured vs Unsecured Debt __________

Variable vs Fixed Rate __________

Required

Classify each Type of Credit. For each TYPE OF CREDIT listed in the first column, you’ll categorize it using the corresponding abbreviations.

TYPE OF CREDIT:

Payday Loan
Installment Loans vs Revolving Credit__________

Secured vs Unsecured Debt __________

Variable vs Fixed Rate __________

Required

Classify each Type of Credit. For each TYPE OF CREDIT listed in the first column, you’ll categorize it using the corresponding abbreviations.

TYPE OF CREDIT:

Personal loan (from a bank) 
Installment Loans vs Revolving Credit__________

Secured vs Unsecured Debt __________

Variable vs Fixed Rate __________

Required

Classify each Type of Credit. For each TYPE OF CREDIT listed in the first column, you’ll categorize it using the corresponding abbreviations.

TYPE OF CREDIT:

Small business loan (from a bank) 
Installment Loans vs Revolving Credit__________

Secured vs Unsecured Debt __________

Variable vs Fixed Rate __________

Required

Classify each Type of Credit. For each TYPE OF CREDIT listed in the first column, you’ll categorize it using the corresponding abbreviations.

TYPE OF CREDIT:

Student loan (Federal)  
Installment Loans vs Revolving Credit__________

Secured vs Unsecured Debt __________

Variable vs Fixed Rate __________

Part II: Reflection

Required

Why do people sometimes use credit to pay for items instead of just using cash?

Required

When applying for credit, is it preferable to receive a low interest rate or a high interest rate?

Required

Sometimes, lenders allow or require a downpayment before they extend you the loan. What would be the advantage to the lender? What would be the advantage to the borrower?

Exit Ticket

Required

3.1 Credit Basics Due (10/7/22 SoC)

In this lesson, you will learn to:

In this lesson, you will learn to:

3.1 Credit Basics Due (10/7/22 SoC)

In this lesson, you will learn to:

In this lesson, you will learn to:

Have you ever borrowed from or lent money to someone? (UCS)

Who did the loan involve?

Did it work out the way you anticipated? Were both people happy at the end? (UCS)

Banking Explained – Money and Credit

What is the relationship between people who save money in banks and people who borrow money from banks? (UCS)

How does the bank make a profit? (UCS)

What is Credit? Loans, Mortgages, and Overdrafts explained

What are the main advantages to a secured vs. unsecured loan? (UCS)

What factors determine interest rates? (UCS)

Understanding How Loan Payments Work

Why does the amount of INTEREST you owe decrease every month? (UCS)

Day 2

ANALYZE: Understanding Amortization

Part I: Categorize Different Types of Credit

Part II: Reflection

Why do people sometimes use credit to pay for items instead of just using cash?

When applying for credit, is it preferable to receive a low interest rate or a high interest rate?

Sometimes, lenders allow or require a downpayment before they extend you the loan. What would be the advantage to the lender? What would be the advantage to the borrower?

Exit Ticket

Have you ever borrowed from or lent money to someone? (UCS)

Who did the loan involve?

Did it work out the way you anticipated? Were both people happy at the end? (UCS)

Banking Explained – Money and Credit

What is the relationship between people who save money in banks and people who borrow money from banks? (UCS)

How does the bank make a profit? (UCS)

What is Credit? Loans, Mortgages, and Overdrafts explained

What are the main advantages to a secured vs. unsecured loan? (UCS)

What factors determine interest rates? (UCS)

What is a danger of taking a variable rate loan? (UCS)

Understanding How Loan Payments Work

Why does the amount of INTEREST you owe decrease every month? (UCS)

Day 2

ANALYZE: Understanding Amortization

Part I: Categorize Different Types of Credit

Part II: Reflection

Why do people sometimes use credit to pay for items instead of just using cash?

When applying for credit, is it preferable to receive a low interest rate or a high interest rate?

Sometimes, lenders allow or require a downpayment before they extend you the loan. What would be the advantage to the lender? What would be the advantage to the borrower?

Exit Ticket

What makes a loan be categorized as secured?

Which of the following is usually a secured debt?

Which of the following is a TRUE statement describing the benefits of an installment loan?

What is a danger of taking a variable rate loan? (UCS)

What makes a loan be categorized as secured?

Which of the following is usually a secured debt?

Which of the following is a TRUE statement describing the benefits of an installment loan?