Financial Lit - GRIT Loans Review

What we have learned about so far...

• Credit Basics

• Auto Loans

• Mortgage Loans

The bank's ability to trust you with money.

• It determines whether you will be approved for a loan.

• It determines how much credit you will be trusted with.

• Some jobs or landlords will check your credit score before accepting your application.

Buying vs. Leasing

​You are interested in a used car, not more than three years old, with under 40,000 miles. You’ve found a two-year-old 4-door sedan for $16,921 at one dealer. Your financial institution has used car loans for qualifying buyers for 36 months at 4.39%. Another dealer is leasing one-year-old 4-door sedans for $2,000 at signing and then $285 a month for 36 months. You have $2,000 saved to apply to a car purchase or lease. Use that to make a down payment.

Compare the costs of financing a car vs. leasing it. What are the total amounts to buy or lease these cars?

https://www.bankrate.com/loans/loan-calculator/

Down payment = % * Price of Home / Vehicle​

Loan Amount = Price of Home / Vehicle - Down Payment - Cash Allowance (if applicable)

What is it?

PMI is arranged by the lender and provided by private insurance companies. It insures the lender against loss caused by borrowers failing to make loan payments.

Factors that Effect PMI

• Credit Score

• Loan to Value

• Type of Loan

• Down Payment