topic 3

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1.Identify 5 factors which could influence interest charged on a borrowing
Home price and loan amount,Down payment, Loan term, Interest rate type, Loan type
1 of 14
Describe an affordable monthly repayment?
House, car or phone bill
2 of 14
Describe the process of rolling over a credit card?
This involves moving your debt onto a card with a low introductory interest rate.
3 of 14
Name three factors that should affect the length of a loan?
Credit scores, Home location,Home price and loan amount
4 of 14
List 5 consequences of not repaying a debt?
Reduces Your Effective Income, Can Affect Your Purchasing Power, House repossession, Blacklisted-not able to get another loan, Product may be withdrawn
5 of 14
List five benefits of owning your own home?
Sense of security, Incentive to maintain property, Good way of saving for retirement, Once home loan is paid off they own the property,Do not have to pay rent at an old age
6 of 14
What is a ‘secured deed’?
This means that if a person cannot continue to make repayments on the loan, the lender can claim the property back and sell it to pay off the remainder of the debt.
7 of 14
Why are there less ‘first-time buyers’ nowadays?
House prices have risen in relation to earnings and lenders have opposed stricter conditions, so many people have to save for several years to save up for a deposit.
8 of 14
Describe the term ‘property ladder’?
The property ladder is a term widely used in the United Kingdom to describe the relative differences in constant terms from cheaper to more expensive housing.
9 of 14
What is the minimum age for taking out a mortgage?
21
10 of 14
what is the maximum age for taking out a mortgage
70
11 of 14
Name the two main factors that determine how much a provider will will lend to a mortgage customer?
Loan to income (LTI), Loan to value (LTV)
12 of 14
Define the LTI ratio?
Loan to income is the ratio of the size of the loan to the income of the customers and it means that the lower someone's income, the less they can borrow.
13 of 14
Define discretionary income?
income remaining after deduction of taxes, social security charges, and basic living costs.
14 of 14

Other cards in this set

Card 2

Front

Describe an affordable monthly repayment?

Back

House, car or phone bill

Card 3

Front

Describe the process of rolling over a credit card?

Back

Preview of the front of card 3

Card 4

Front

Name three factors that should affect the length of a loan?

Back

Preview of the front of card 4

Card 5

Front

List 5 consequences of not repaying a debt?

Back

Preview of the front of card 5
View more cards

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