Lending Practices and Loans, Finance And Accounting

Question: What is meant by the term "Forbearance"?
A
A postponement of payment on a loan, typically if the borrower doesn't qualify for a deferment and is unable to make payments for a reason such as poor health

B
A step taken during bankruptcy

C
An extra loan payment made to pay down principal

D
None of these

Note: Answer not sure
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Question: Why have the lenders been restricting the issuance of credit cards in recent years?
A
Because consumer credit ratings have been going down rapidly

B
Because higher bankruptcy and non payment levels by consumers have been eating into the profit levels

C
Because consumers have nothing else to buy

D
Because there is a tendency among consumers to take out home loans instead

Note: Answer not sure
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Question: What is something that has been made payable and is overdue and unpaid called?
A
Commission

B
Promissory note

C
Delinquent

D
Repossessed

Note: Answer not sure
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Question: How would a company that purchased a building using a mortgage show it in its account books?
A
Dr: Cash, Cr: Interest Payable

B
Dr: Buildings, Cr: Mortgage Liability

C
Dr: Interest Payable, Cr: Mortgage Liability

D
Cr: Cash, Cr: Mortgage Liability

Note: Answer not sure
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Question: What type of repayment plans do credit cards typically have?
A
Exactly half is due

B
Some small portion of the consumer's total balance is due each month

C
They must be paid in full

D
Only interest is due each month

Note: Answer not sure
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Question: What does the term "Collateral" mean?
A
Assets pledged to secure the repayment of a loan

B
The monthly payment of a loan

C
Only the principal portion of a loan

D
A situation where one fails to make a payment, which can lead to foreclosure

Note: Answer not sure
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Question: When do lenders require Private Mortgage Insurance (PMI)?
A
When the loan to value ratio is greater than 80%

B
When the buyer makes under $40,000 a year

C
When the buyer has unfavorable credit

D
When the buyer is a millionaire

Note: Answer not sure
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Question: Why are "Pay Day Loans" considered predatory?
A
They target people with jobs

B
They are offered in stores

C
They charge interest rates lower than credit cards

D
They are short term loans with interest rates far higher than those on any standard loan and are typically aimed at the poor and/or the uneducated people

Note: Answer not sure
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Question: What does the term "Escrow" mean?
A
A sum a borrower pays to a lender to decrease the interest rate of a mortgage

B
The market value of a home

C
A neutral third party that carries out the instructions of both the buyer and the seller to handle all the paperwork of settlement or closing

D
The amount by which a home is overpriced above the market price

Note: Answer not sure
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Question: What type of debt do credit cards fall under?
A
Revolving debt

B
Unsecured debt

C
Secured debt

D
All of these

Note: Answer not sure
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Question: What is meant by the term "Forbearance"?

Question: Why have the lenders been restricting the issuance of credit cards in recent years?

Question: What is something that has been made payable and is overdue and unpaid called?

Question: How would a company that purchased a building using a mortgage show it in its account books?

Question: What type of repayment plans do credit cards typically have?

Question: What does the term "Collateral" mean?

Question: When do lenders require Private Mortgage Insurance (PMI)?

Question: Why are "Pay Day Loans" considered predatory?

Question: What does the term "Escrow" mean?

Question: What type of debt do credit cards fall under?