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The Ultimate Managing a Car Loan Quiz
by Staff
For most people, owning a car is necessary for daily life. With long commutes and chauffeuring your kids around town, it may even seem like you actually live in your car. Due to the necessity of owning a car, your car loan payments should be taken very seriously. Take this quiz and learn all about the ins and outs of managing a car loan.

Who owns your car when you are paying it off?

  • a credit union
  • the car dealership
  • either of the above

How can you determine if a car loan is reasonable given your income?

  • Create a budget that includes monthly car loan payments.
  • Car loan payments should not be greater than a tenth of your overall income.
  • both of the above

Besides car loan payments, what other car-related expenses should be included in your budget?

  • car accessories
  • car insurance
  • both of the above

The average American spends ______ of their income on car loan payments.

  • 6 percent
  • 11 percent
  • 16 percent

What is the preferred method of payment for monthly car loan installments?

  • online payment
  • in-person payment at a financial institution
  • automatic withdrawal payment

What is the recommended payment plan for a car loan?

  • 36 months
  • 48 months
  • 60 months

When should you consider refinancing your car loan?

  • If you are paying steeper-than-average monthly rates.
  • If your credit rating has improved.
  • both of the above

You were told that you are “upside down” on your car loan. What does this mean?

  • Your car is worth more than what you owe.
  • Your car is worth less than what you owe.
  • You monthly payment plans are too high for the value of the car.

What car loan lender typically provides the cheapest car loan plan?

  • credit unions
  • banks
  • car dealerships

What is the benefit of consolidating all of your debts, including your car loan payments, into one payment plan?

  • It's convenient.
  • You may end up saving money with lower interest rates.
  • both of the above

Who should consider a debt consolidation with a bank?

  • someone who has a good credit history
  • someone who can comfortably make debt payments each month
  • both of the above

What type of debt consolidation should you avoid?

  • A debt consolidation that promises low monthly payments.
  • A debt consolidation that has interest rates above 20 percent.
  • both of the above

What is likely to happen if you default on your car loan payments?

  • Your car will be immediately repossessed.
  • You will be required to pay a hefty fine.
  • both of the above

How do you get back your car after it has been repossessed?

  • You must pay off the remainder of the car loan.
  • You must pay off the remainder of the car loan and any towing and storage fees.
  • You must pay off the remainder of the car loan, any towing and storage fees, and a hefty fine.

What will you owe your lender after your car has been repossessed?

  • You may owe a deficiency fee.
  • All debt is typically forgiven after repossession.
  • You will owe a large fine to be determined by your lender.

What is an automobile electronic disabling device?

  • It's a device to prevent repossession of your car.
  • It's a device to remind and motivate you to pay your monthly car loan payments.
  • It's a device to prevent car theft.

What should you do if you suspect that your going to default on your car loan?

  • Call your lender to discuss alternative payment arrangements.
  • Sell your car and use the proceeds to pay off the remainder of your loan.
  • either of the above

When all else fails, what should you do when a car loan default is eminent?

  • Drive your car to your lender and give it in.
  • Sell the car back to the dealership.
  • Wait and see what happens.

How do you best avoid defaulting on your car loan?

  • Make advanced payments.
  • Use automatic withdrawal.
  • Monitor your payments every month.

How long will your credit rating be affected by a car loan default?

  • 5 years
  • 7 years
  • 10 years