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28 Cards in this Set

  • Front
  • Back
What is the cost of a loan in dollars and cents?
Finance Charge
The true interest rate of a loan is called ___________?
Annual Percentage Rate (APR)
What 3 types of law apply to the purchase of a vehicle?
1. The Uniform Commercial Code
2. Consumer Protection Laws
3. Laws regulating credit
The costs of owning a vehicle include ___________.
Initial Purchase Price
Fuel Costs
What is the first step in financing a vehicle?
Begin with a budget
Transportation costs for all of the vehicles that you own should not exceed what % of your household income?
How long does it take to remove incorrect or outdated information from your credit report?
60-90 days
What are the three major credit agencies?
1. Equifax
2. Experian
3. Trans Union
You are entitled to 1 free credit report from each agency once a year as well as under what other 2 conditions?
1. If you suspect fraud
2. Entitled to a free report after being turned down for credit
What is the name of your credit score named after the Fair Isaac Corp. that designed the scoring model?
FICO score
What five factors is your credit score based on?
1. Past payment history
2. Outstanding debt
3. How long you've had credit
4. How much new credit you've applied for
5. The types of credit you have
A negative report on your credit payment history stays on your record for how long?
7 years
What is a "Prime Borrower"?
Has a credit score above 680
What is a "Sub-Prime Borrower"?
Has a credit score below 680
What % does a normal car depreciate the minute it leaves the showroom?
What does being "upside down" on your car loan mean?
You owe more than the car is worth.
Leasing a new car is usually not a good option if you drive more than how many miles a year?
12,000-15,000 miles a year
What 3 options do you have at the end of a lease?
1. Give the car back
2. Buy it for the residual value set in the contract
3. Trade it for a new car and a new lease
What are the 2 best times of the year to purchase a new car?
1. December
2. Between July and October when dealers are making room for new models
When buying a car, you will pay a higher interest rate on a new or used car?
Interest rates on used cars are usually higher
"Liability Insurance" covers what 2 components?
Bodily injury and Personal Property liability
(True/False): All 50 states require minimum liability insurance.
What is the minimum amount of insurance required in Illinois?
1. $20,000 injury or death of 1 person in an accident
2. $40,000 injury or death fo more than 1 person
3. $15,000 damage to property of another person
What type of insurance covers your car in the event of theft or natural disaster?
Comprehensive Insurance
What does "Deductible" mean with regard to insurance?
It's the maximum amount you will pay out of pocket
A higher deductible usually means that your insurance premiums will be higher or lower?
What type of auto insurance provides protection from "hit and run" accidents?
Unisured Motorists Insurance
What is the most effective way to lower your auto insurance rates?
A clean driving record