Exam 18: Consumer Loans, Credit Cards, and Real Estate Lending

The purchase of a house or a multifamily dwelling such as a duplex,triplex or apartment building is usually financed through the use of a ______________________ loan.

Jerry McGuire uses his Visa card to buy a new washer and dryer and a new refrigerator for his home.He plans on paying off the credit card over the next two years.How is Jerry using his credit card?

The law that requires full disclosure of credit terms and which promotes the informed use of credit is the ______________________ Act.This law requires banks to report the APR of the loan,the dollar amount of all finance charges and,where appropriate,all fees.

The interest rate method that adds the interest amount owed to the principal before calculating required installment payments is called the __________ method.

A variable rate loan on a residential mortgage is known as a(n)______________________.

According to the text,which of the following types of loan has the lowest interest rate?

The fastest rising financial crime against individuals today is __________________ theft.This is a deliberate attempt to take unauthorized use of someone else's personal information in order to fraudulently obtain money,credit,or other property.

Mark Brown receives a $2,000 loan with the intention of repaying the loan in 12 months.However,at the end of one month,Mr.Brown discovers that he can repay the loan in full.According to the rule of 78s,what percentage of the interest charge is he entitled to receive as a rebate?

A bank is considering making a loan to Alice Granger.The bank is looking at her credit report from Equifax and also examining the reason Alice has put on the loan application for needing the loan.According to the text,what aspect of evaluating a consumer loan application is the bank looking at?

Currently the debit card market is one of the fastest growing of all household financial services,substantially exceeding the recent growth of credit cards.

According to recent research findings,the quotation of the APR to customers on the loan they are requesting usually discourages consumers from shopping around.

Under the discount rate method,interest amount is required to be paid upfront and the customer receives the loan amount net of any interest owed.

Credit reports provided by credit bureaus provide lenders with:

A bank is considering making a loan to John Carter.John is a commissioned sales broker.Some months he earns as much as $10,000 and in other months he earns virtually nothing.Which aspect of evaluating a consumer loan would this be concerned with?

The burden of proof is on a bank to demonstrate that its credit scoring system successfully identifies quality loan applications at a statistically significant level.

Lenders in the consumer loan field prefer to measure a borrowing customer's income by the amount of take-home pay.

One new type of mortgage where no principal payments are made for an initial period is called a(n)_______________.

A bank is considering making a loan to Neville Langdon.Neville has bounced three checks in the last year and already has $10,000 on a credit card and an automobile loan with a large balance due.What aspect of evaluating a consumer loan application is this fact concerned with?

A(n)__________________________ loan is one where a customer can use the difference between the appraised value of their home and the amount of mortgage remaining against it to secure a loan.

A bank that is judged as needing to improve under the performance requirements of the Community Reinvestment Act will receive an examiner rating of: