UNIT 6: CREDIT

Important Questions:

1. What is credit?

2. What is interest?

3. Do you know the difference between debit and credit?

4. What is a credit report?

5. Do you know what a credit score is and what it’s for?

6. How many credit cards should you have?

7. Do you know how to plan a budget?

8. Do you have a plan to pay for college?

9. If you have a bill that’s due, but can’t pay it, what should you do?

10. What does it mean to have your identity stolen?

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UNIT 7: LOANS AND PAYMENTS

Important Questions:

1. What is a student loan?

2. What is the difference between a federal and private loan?

3. What can a student loan be used for?

4. What is the grace period on a student loan?

5. How do I repay my student loans?

6. What if I can't afford my payments?

7. Can I pay off my loans early?

8. What is the best student loan interest rate?

9. What is the FAFSA form?

10. Is college worth the cost?

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UNIT 8: HOME OWNERSHIP

Important Questions:

1. How much money must be loaned to receive $15,000 if the money is loaned for five years at 12% interest?

2. Mr. Johnson bought a house for $64,500. He later sold the house and broke even, after paying 8% of the selling price in commission, and escrow fees. How much had the lot increased in value?

3. Steve sold his home which had no loans against it. He received a settlement check from escrow for the amount of $96,400 after paying escrow fees of $1,365.00 plus a 6% real estate broker's commission. What was the selling price?

4. What is the salesman's 40% of a 6% commission on a $32,000 sale?

5. Ted paid $85,000 for a house, putting up a 15% cash down payment and borrowing the balance at 8.5% interest. The loan is payable over 30 years with monthly payments of $560, including principal and interest. If Ted makes the payments as scheduled, the percentage that the original cost of the house increased because of the use of credit is?

6. A $5,000 investment at 10% interest compounded annually earns how much in three years?

7. How much interest would a $6,000 loan earn in five years at 10% simple interest?

8. An agent lists a seller's house for 6 percent commission. The final agreed sales price is $205,000. How much commission did the seller pay?

9. Hector and Maria Hernandez have paid a total of $10,500 in mortgage interest and $1,500 in property taxes in this tax year. If they are in the 28% tax bracket, their tax savings is:

10. Cindy purchased a lot for $40,000. She has been asked to build an apartment house with a projected income of $20,000 per year. Her accountant estimates all expenses, including proper management, repairs, etc., to be $12,000 per year. Cindy wants a 10% return on her investment. Which of the following is nearest to the amount she can afford to pay for the erection of the building?

• $110,000

• $50,000

• $120,000

• $100,000

11. A building that has an effective gross income of $65,000 and total operating expenses of $6,500 has a net income ratio of:

• .16

• .19

• .90

• .10

12. In order to be able to earn $90.00 per month from an investment that yields a 6% return, you must invest?

• $9,000

• $18,000

• $2,500

• $15,000

13. A buyer is obtaining a conventional loan that requires 29/33 ratios. He earns $75,000 a year, and has a $450 car payment. What is his maximum PITI payment?

• $1,812.50

• $21,750.00

• $1,612.50

• $2,475.00

14. If building costs increase by 15%, the purchasing power of the investment dollar decreases by:

• 13%

• 20%

• 25%

• 33-1/3%

15. Lynn sold a home for $27,000. She made a 15% profit. What did the home cost?

• $18,333

• $20,000

• $20,833.33

• $23,478

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UNIT 9: CAR OWNERSHIP AND INSURANCE

Important Questions:

1. Why is it important to see what safety systems are included in a car?

2. What is better: gas, electric, or a hybrid car? Why?

3. How do you find out how much it will cost to maintain a car?

4. What are finance options?

5. What is a good price for a car for a teen? For an adult with a job at Costco? For an adult that is a lawyer? Why do you think this way?

6. What is resale value?

7. Should you buy used or new for a car? Why?

8. What is a "salvage title"? Is this a good thing?

9. Why is it important a used car has a maintenance record?

10. What is a warranty and is it important?

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UNIT 10: INVESTMENTS

Important Questions:

1. What will my mortgage rate be today (Google it)?

2. How long is my mortgage rate good for that you just looked up?

3. How do you calculate a mortgage payment?

4. What is a refinance?

5. What is PITI?

6. How much are closing costs and what is it?

7. What is an FHA loan?

8. If your loan amount is $200,000 and you are being charged 1 point. What amount of money is that?

9. What is the difference between a 15 year adjustable rate mortgage and a 30 year fixed rate?

10. Is there anything we can do to increase my credit score to get a better rate?

When completed with terms, notes and questions: take test and staple to front of work:

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