Question

1.Which of the following personal loan options would be the most appropriate for use as an emergency source of funds?

Deposit advance.

Line of credit.

Payday loan.

Installment loan.

2.Compared with repayment plans based on a borrower’s income, the standard repayment plan will generally:

Minimize the amount of interest paid.

Payoff the loan more quickly.

Have a higher monthly payment.

All of these answer choices are correct.

Answer 1

1) The correct option is Deposit advance

Deposit advacne is a short term loan with high interest rate provided by the banks or the credit union, In this, the customer can withdraw the amount as per their needs and the financial intermediaries will pay themselve back when the next deposit is made or they can charge the customer account if the payment is not amde within 35 days.

2) The correct option is All of these choices are correct

Standard repayment plan is a plan when the repayment is done within 10 years or 120 Monthly payments, the min benefit is lesser amount of total interest has to be paid, the loan could be amortized more quickly but it would lead to the higher monthly payments.