Podcast
Questions and Answers
Match the types of loans with their key considerations:
Match the types of loans with their key considerations:
Personal loans = Unsecured, higher interest rates for small amounts Cash advances = Extremely high interest rates, last resort for small amounts Student loans = Reasonable interest rates, can lead to substantial debt for recent graduates Mortgage loans = Secured by property, tax-deductible, low interest rates for buying homes
Match the loan products with their usage:
Match the loan products with their usage:
Home-equity loans and lines of credit = Borrow against house equity for home improvements, debt consolidation Small business loans = Available from local banks, require business plan and personal assets as collateral Personal loans = Easier to obtain, typically for small amounts with average credit history Cash advances = Easy to get but come with extremely high interest rates, last resort for small amounts
Match the loan types with their potential impacts on borrowers:
Match the loan types with their potential impacts on borrowers:
Student loans = Can lead to substantial debt for recent graduates Mortgage loans = Enable individuals to buy homes with structured terms and tax-deductible, fairly low interest rates Home-equity loans and lines of credit = Allow homeowners to borrow against their house equity for home additions, improvements, or debt consolidation Small business loans = Require more work, often needing a business plan and personal assets as collateral in case the business fails
Personal loans are often ______ and easier to obtain with an average credit history, typically for small amounts not exceeding $5,000, but with higher interest rates than secured loans.
Personal loans are often ______ and easier to obtain with an average credit history, typically for small amounts not exceeding $5,000, but with higher interest rates than secured loans.
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Cash advances are easy to get but come with extremely high interest rates, usually for small amounts, and should only be considered when no alternative ways to get money ______.
Cash advances are easy to get but come with extremely high interest rates, usually for small amounts, and should only be considered when no alternative ways to get money ______.
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Mortgage loans are typically the biggest loans, secured by the purchased property, and enable individuals to buy homes with structured terms and tax-deductible, fairly low interest ______.
Mortgage loans are typically the biggest loans, secured by the purchased property, and enable individuals to buy homes with structured terms and tax-deductible, fairly low interest ______.
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Study Notes
Types of Loans and Key Considerations
- Personal loans are often unsecured and easier to obtain with an average credit history, typically for small amounts not exceeding $5,000, but with higher interest rates than secured loans.
- Cash advances are easy to get but come with extremely high interest rates, usually for small amounts, and should only be considered when no alternative ways to get money exist.
- Student loans, such as Stafford and Perkins loans, are common and offer reasonable interest rates, but can lead to substantial debt for recent graduates.
- Mortgage loans are typically the biggest loans, secured by the purchased property, and enable individuals to buy homes with structured terms and tax-deductible, fairly low interest rates.
- Home-equity loans and lines of credit allow homeowners to borrow against their house equity for home additions, improvements, or debt consolidation, with tax-deductible, fairly low interest rates.
- Small business loans are available from local banks and require more work, often needing a business plan and personal assets as collateral in case the business fails.
Types of Loans and Key Considerations
- Personal loans are often unsecured and easier to obtain with an average credit history, typically for small amounts not exceeding $5,000, but with higher interest rates than secured loans.
- Cash advances are easy to get but come with extremely high interest rates, usually for small amounts, and should only be considered when no alternative ways to get money exist.
- Student loans, such as Stafford and Perkins loans, are common and offer reasonable interest rates, but can lead to substantial debt for recent graduates.
- Mortgage loans are typically the biggest loans, secured by the purchased property, and enable individuals to buy homes with structured terms and tax-deductible, fairly low interest rates.
- Home-equity loans and lines of credit allow homeowners to borrow against their house equity for home additions, improvements, or debt consolidation, with tax-deductible, fairly low interest rates.
- Small business loans are available from local banks and require more work, often needing a business plan and personal assets as collateral in case the business fails.
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Description
Learn about the characteristics and drawbacks of unsecured personal loans and cash advances, including their ease of access, smaller loan amounts, and higher interest rates.
