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Capstone

Capstone. Personal Finance Assessment NOTES. Personal Finance. 1. What is a mortgage?. The term for a monthly payment on a HOUSE. 2. Why are interest rate important in dealing with loans?. They determine the COST of the loan!. HIGH Interest Rate: Higher payment/wasted money

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Capstone

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  1. Capstone Personal Finance Assessment NOTES

  2. Personal Finance 1. What is a mortgage? The term for a monthly payment on a HOUSE 2. Why are interest rate important in dealing with loans? They determine the COST of the loan! • HIGH Interest Rate: Higher payment/wasted money • LOW Interest Rate: Lower payment/less waste

  3. Excellent credit, length of time of loan 3. How do you achieve a Low Rate loan? 4. What is an amortization schedule? A schedule of the life of the loan, including total interest cost and principal reduction 5. What is the effect of…. a. Extending the loan for more months/years? Smaller payment (pay more interest) a. Extending the loan for more months/years? Larger payment (pay less interset)

  4. Leasing is renting – you can obtain a cheaper payment, but you are not working towards owning the asset 6. Leasing vs. Purchasing…

  5. Credit/FICO 7. Why is a good credit score important? It allows you the best interest rates on your loan 8. How do you obatin a good score? Pay bills ON TIME, reduce debt, pay off cards every month, limit the amount of cards you have, you only need a FEW cards

  6. 9. Your score is measured by… 10. Scores range from? 300 – 850

  7. Experian • Equifax • Transunion 11. Name the three Credit Bureaus

  8. Banking 12. Purpose for reconciliation. To double check your checking/banking balance. Check for errors. 13. A check that hasn’t cleared the bank… “outstanding”

  9. Take the amount out of the bank’s ending balance 14. A check that didn’t clear the bank… 15. A transaction not recorded in the register… Take the amount out of your check register

  10. Resources • Apps: car loan, Carl’s mortgage calculator • Website: bankrate.com, myfico.com

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