FINN 1003 Final

People tend to borrow money for four reasons:

Click the card to flip 👆

1 / 64

Terms in this set (64)

People tend to borrow money for four reasons:

to avoid paying cash for large outlays
to meet a financial emergency
for convenience
for investment purposes

The 5 C's of Credit

Character, Capacity, Collateral, Capital, Condition

Character (5 C's)

Will you repay the loan?

Capacity (5 C's)

Can you repay the loan?

Collateral (5 C's)

What if you don't repay the loan?

Capital (5 C's)

What are your assets and net worth?

Condition (5 C's)

The extent to which prevailing economic conditions could affect the borrower's ability to service a loan.

Average Daily Balance (ADB)

a method of computing finance charges by applying interest charges to the average daily balance of the account over the billing period

What can you do to protect yourself from identity theft?

Deter, Detect, Defend

It is good to use credit for: