Assessments

Shopping for an Automobile Loan Project

You are to complete all of the calculations in the cost of a loan, including the down payment, principal loan amount, interest paid, purchasing cost, and monthly payment. You are also to compute the sticker price of a new vehicle, dealer’s cost of a new vehicle, and the average retail price of a used vehicle. Once you have completed all of the business math problems, you will need to choose a specific automobile to purchase. You will compare five different lenders and answer the following questions in a word document:

Which lender offered the best loan? List three reasons why the loan you chose is the best option. A graphic organizer that illustrates
 * the similarities and differences of financing versus leasing
 * the similarities and differences of purchasing a new vehicle versus a used vehicle

**Your paper should be double-spaced in Times New Roman, 12 font only**

Refer to the following sites to assist you with completion of the project:

http://www.consumerreports.org/cro/2012/12/how-to-get-the-best-car-loan/index.htm http://www.bankrate.com/finance/auto/6-common-car-shopping-mistakes-1.aspx [] [] [] [] [] [] []


 * ** • ** || Shopping for the best credit card deal


 * Situation #1- You have just lost your student loan because of an error you made in your loan application. It will take 6 months to straighten it out. You have no savings. In order to continue your education you decide to get a credit card and use it to go to school for one semester until your loan situation is straightened out. You plan to take 18 hours of classes at a tuition rate of $167.20 per credit hour for out-of-state tuition. Books will cost $320. You plan to pay back the credit card loan within 4 years with monthly payments of at least $60. You work a 30 hour week and earn $8 per hour after taxes. Your car payment is $150 per month. Your rent is $300 per month and utility bills run about $90 per month. **

// Key questions to ask before signing up for a credit card //
 * Is there an introductory rate? What is it and how long does it last? ||
 * ** • ** || After that, what will my rate be? ||
 * ** • ** || Is there an application fee? ||
 * ** • ** || Are there processing fees? ||
 * ** • ** || Is there an annual fee? ||
 * ** • ** || Is there a late fee? ||
 * ** • ** || Is there an over-the-limit fee? ||
 * ** • ** || Are there any other fees, like account termination fees or balance-transfer fees? ||
 * ** • ** || When and how can a variable rate be changed? ||
 * ** • ** || What is the grace period before interest is applied? ||
 * ** • ** || How will you inform me of any changes in my contract? ||
 * ** • ** || Will the company inform me if I am about to go over my limit? ||
 * ** • ** || If I go over my limit, what happens? ||
 * ** • ** || What is the company policy if I have trouble paying my bill? ||
 * ** • ** || May I pay my bill online? ||


 * Situation #2 - You need to have a surgical procedure done and do not have the $3000 cash necessary for the operation. Talking to an administrator at the hospital, you find that the hospital will accept credit cards such as Master Card, VISA and Discover credit cards. Assume that you plan to take one year to pay off the loan with payments of at least $300 a month. Find the best credit card for your situation. Additional information: You make about $425 per week clear after taxes. You have a car payment of $235 per month, rent payment of $400, utility bills of $110 per month. There is $1200 in your savings account. **

Use the following site to search for the best credit card offers for each situation:

http://www.credit.com/credit-cards/

Credit Assessment