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Borrowings - Chapter 5 - Coggle Diagram
Borrowings - Chapter 5
Borrowers Rights
Must be told:
- APR of interest
- Total cost of loan
- Amount & number of payments
- Deposit or final payment amounts
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Where to borrow from
- Commercial Bank
- Credit Union
- Moneylender
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Cost of Borrowing
Flat Rate of interest
- Interest is based on the original amount borrowed. Does not take into account that the amount we owe reducing after payments are made.
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Security
Anything of value that the borrower will accept in exchange for a loan. If a borrower does not repay the money, then the lender may take the security and sell it to get their money back. E.g. the deeds of your house.