Types of Credit Unit

Students will be able to:

• Identify the major types of credit and their characteristics 
• Understand the three basic components of lines of credit: principal, interest rate, and term
• Define net worth and how it is calculated

Students will be able to:

• Enumerate the differences between debit, prepaid debit, and credit cards
• Identify at least 3 ways a young adult can gain access to a credit card, even before they are 21
• Read a Schumer Box

Students will be able to:

• Explain why a person may need or want to use credit 
• Explain how a credit card works in terms of making purchases and managing payments
• Understand how interest is charged and how to avoid or minimize it

Students will be able to:

• Interpret data to understand what types of debt the average American household has
• Differentiate between amortized installment loans and revolving credit lines
• Read an amortization table and understand how the payments are structured
• Describe how Buy Now, Pay Later plans work

Students will be able to: 

• Calculate how much an auto loan will cost given special offers as well as standard factors such as down payment, APR, and term
• Compare auto loan offers and decide how they fit within your budget

Students will be able to

• Explain what a mortgage is and why most Americans require one to finance a home
• Use a mortgage calculator to explore how downpayment, credit score, interest rate, and term all impact the total cost of buying a home
• Distinguish between fixed- and adjustable-rate mortgages

Students will be able to

• Explain what a payday loan is and how it can cause users to fall into a cycle of debt 
• Identify what financial need payday lenders are meeting and why consumers use payday loans
• Compare the price of borrowing money using various loan and credit products

Students will be able to

• Explain why a person may need or want credit
• Identify the major types of credit and their characteristics 
• Understand the three basic components of lines of credit: principal, interest rate, and term

Students will be able to

• Explain how a credit card works in terms of making purchases and managing payments
• Read a Schumer box and identify how terms of the card impact total cost of purchases
• Understand how interest is charged and how to avoid or minimize it

Students will be able to

• Enumerate the differences between debit and credit cards
• Identify at least 3 ways a young adult can gain access to a credit card, even before they are 21
• Explain why a secured credit card is an excellent way to build credit
• Read a credit card monthly statement

Students will be able to

• Differentiate between amortized installment loans and revolving credit lines
• Read an amortization table and understand how the payments are structured
• Consider whether taking out a loan is a good or bad idea in a given circumstance

Students will be able to

• Calculate how much an auto loan will cost given special offers as well as standard factors such as down payment, APR, and term
• Compare auto loan offers and decide how they fit within your budget
• Negotiate with car salespeople to get the best deal

Students will be able to

• Identify steps they can take to prepare for student loan repayment
• Understand the different loan repayment options available
• Analyze sample graduate profiles and choose the repayment option that works best in the context of an individual’s situation

Students will be able to

• Take precautions to avoid having their identity stolen
• Appreciate the dangers of payday lending and identify payday lending laws in their state
• Develop strategies for eliminating debt should they find themselves accumulating a lot of it

Students will be able to:

• Correctly use fundamental vocabulary related to credit and lending
• Explain how loan amortization and payments work
• Understand how principal, interest rate, and term are critical components to evaluating credit options

In this lesson, students will be able to:

• Explain how a credit card works in terms of making purchases and managing payments
• Read a Schumer box and identify how terms of the card impact total cost of purchases
• Understand how interest is charged and how to avoid or minimize it
• Read a credit card statement

In this lesson, students will be able to:

• Establish criteria for choosing a credit card, based on the factors important to their needs
• Recognize and avoid marketing schemes that might lead to bad decisions
• Identify alternative routes to establishing credit, aside from opening their own credit card account  

In this lesson, students will be able to:

• Explain the fundamental features of a personal loan, including where to find one and how to apply
• Explore the peer-to-peer lending market as an alternative to traditional banks
• Understand the potential pitfalls of borrowing from family and friends, a personal 401(k), or a payday lender

In this lesson, students will be able to:

• Utilize knowledge and strategies to get the best possible financing terms (that meet their individual needs and budget) for a new or used car
• Explain the difference between a car loan and lease as well as advantages and disadvantages of each
• Have a backup plan if they find themselves unable to afford their car payments

In this lesson, students will be able to:

• Make informed decisions about how much student loan debt to take on, based on college costs and projected salary upon graduation
• Explain the difference between private and Federal loans, and the various types of Federal loans, and when to use each
• Select the best repayment option to minimize total amount paid while also keeping monthly payments reasonable within a budget
• Learn strategies for avoiding default, including whether consolidation is an appropriate option

In this lesson, students will be able to:

• Understand how down payment, interest rate, term, loan type, and amortization table work together to impact overall mortgage payments
• Recognize the pros and cons of fixed- and adjustable-rate mortgages
• Determine whether a home equity loan or line of credit is a viable loan option
• Decide whether renting or buying makes the most sense