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Test on Paying for College & Student Loans
Contributed by: Garcia
  • 1. what is the Main Purpose of FAFSA?
A) It helps colleges and universities determine whether you ca afford on-campus housing.
B) It helps banks and other lenders know what interest rate to charge you for student loans
C) It helps the government and colleges determine the level of aid for which you qualify.
D) It helps the government and colleges determine whether you are eligible for academic scholarships.
  • 2. Which is potential advantage of community colleges over private colleges and state universities?
A) They offer more scholarships and grants.
B) They offer more programs
C) They are easier to apply to
D) They are less expensive
  • 3. An academic scholarship is an example of _________.
A) Need-Based Financial Aid
B) Merit Based Financial Aid
C) A university work study program.
D) A federal government loan program
  • 4. When do you usually have to begin paying back federal loans.
A) When you get a Full-Time Job
B) Within Six Months of Graduation
C) In your last year of College
D) When you start to pay taxes.
  • 5. When you start paying back loans, what is the first thing you should pay?
A) The Principal
B) The FAFSA
C) The Work Study
D) The Interest
  • 6. Which of the following is true?
A) Small Private schools charge lower tuition than larger schools.
B) All colleges usually charge lower tuition for students who have federal loans.
C) State Schools usually charge lower tuition for students living in the state.
D) Private Schools usually charge lower tuition for students who do well in high school.
  • 7. Marta wants to go to college, but she is concerned about the cost. Which option would you recommend.?
A) Taking out a Private Loan and attending a State College.
B) Taking out a federal loan and attending a Private College.
C) Taking out a federal loan and attending a state college.
D) Taking out a private loan and attending a Private College.
  • 8. One advantage of federal loans over the bank loans is that federal loans,
A) Do not affect your credit score.
B) Can be pair monthly or yearly.
C) Do not have to be paid back.
D) Have a fixed interest rate.
  • 9. The US Department of Education's Pell Grant is an example is an example of ____________.
A) Merit- Based Financial Aid
B) A University Scholarship Program
C) Need- Based Financial Aid
D) A Federal Government Loan Program
  • 10. The federal government offers subsidized loans to students with __________.
A) A Financial Need
B) Good Grades
C) Low Credit Scores
D) Unusual Interests
  • 11. The FAFSA is __________.
A) An application for federal students aid
B) An office where you can make an appointment to discuss federal loan repayment.
C) A distributor of private student loans.
D) A inexpensive state college.
  • 12. A Student Loan is _________.
A) Money you can get if you have a high GPA in high school.
B) Money you can borrow to pay for college that you will have to repay later.
C) Money all college students receive to pay for college tuition.
D) A gift the government gives you to pay for a very expensive college.
  • 13. Which of the following is a true statement?
A) You never get charged interest on student loans.
B) You can pay back your loan little by little.
C) You only have to repay half of your original student loan.
D) You have to repay your student loans before you graduate college.
  • 14. Interest is the ___________.
A) Time it takes you to repay your loan.
B) Total amount of money you can take out in loans.
C) Initial amount of money you borrowed.
D) Fee added to the amount you owe.
  • 15. The sooner you repay your loan, the __________.
A) Higher the interest rate on the loan will become.
B) More likely you are to default.
C) More extra money you will spend paying back your loan.
D) Less extra money you will spend paying back your loan.
  • 16. Carlo always pays more than his minimum loan payment, so he is ________.
A) Building up more interest and repaying less on principal
B) Repaying more of his principal and building up less interest.
C) Paying more fees directly to the bank.
D) Defaulting on his loan.
  • 17. Money spend on interest _________.
A) Lowers your principal.
B) Does not go toward repaying the money you initially borrowed.
C) Immediately causes you to have bad credit.
D) Goes toward paying down your original debt
  • 18. Brianna has a good credit score. Which of the following is most likely true?
A) Banks will not lend her money.
B) Brianna has a history of paying her bills in full and on time.
C) Brianna has defaulted on her loans recently.
D) Brianna has missed More than 9 months of loan payments.
  • 19. Joseph recently deferred his loans, which means he ________.
A) Never has to repay them.
B) Missed too many payments in a row.
C) Failed to uphold his end of the loan agreement.
D) Does not have to repay them for a period of time.
  • 20. Will recently defaulted on his loans. He most likely ________.
A) Missed more than 9 months of loan payments.
B) Paid his loan payments on time.
C) Enrolled in the military.
D) Paid more than his minimum payments.
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