They are intended to provide a precise, clearly identifiable and easily classified answer. When you draw from the line, you pay interest on the balance. This type of credit is for specific purposes and allows consumers to purchase a single item or a few commodities. Mortgages, auto payments and student loans are the most common. Closed-end credit is a Credit agreement between the borrower and the lender in which funds are dispersed in full . Since the homeowner is applying for a hybrid HELOC, the maximum amount available for the line of credit is 80% of the home value. This type of credit is for specific purposes and allows consumers to purchase a single item or a few commodities. Because of this, an example of closed-end credit is a home loan. For example, the interviewee may choose a response from a panel of given proposals or a simple "yes" or "no". Inquiries that are closed-ended can be answered by a simple "yes" or "no" (or another super-short reply), while open-ended questions require a more detailed response. A mortgage loan. The Home Ownership and Equity Protection Act (HOEPA) was enacted in 1994 as an amendment to the Truth in Lending Act (TILA) to address abusive practices in refinances and closed-end home equity loans with high interest rates or high fees. Borrowers can take . Closed-end funds, or CEFs, have been around for more than 100 years. And the account is closed permanently after it's paid off. Credit cards, home equity loans, personal lines of credit, and bank account overdraft protection are all examples. XYZ Card Company. Here we address some of the differences between open-end and closed-end funds and answer frequently asked questions regarding the use and structure of closed-end funds. MAPR Calculator for Closed-End Loans. A close-ended question is a type of survey question that restricts respondents to a set of answer-options to choose from. Since HOEPA's enactment, refinances or home equity mortgage loans meeting any of HOEPA's high . A)A mortgage loan. H-16 Mortgage Sample. Try the latest version of Chrome, Firefox, Edge or Safari. They're usually simpler than their open-ended counterparts, allowing respondents to quickly answer. Closed-end credit: is a sort of credit that must be paid back in full by the end of the term, on a specific day. Triggered" Terms [§1026.16(b)]: An advertisement including any of the previous "triggering" terms must also include each of the following disclosures as applicable: a. Close-ended question examples Typically, closed questions will have a one-word answer, such as 'yes' or 'no. " Sometimes, the candidate may respond with other one- or two-word answers. Closed-end funds, which are the oldest, date back to the late 19th century. A CEF's share price is almost always different from its net asset value. Capital does not flow into or out of the funds when shareholders buy or sell shares. The terms of repayment; and. Use this calculator to determine the Monthly Payment and the Military Annual Percentage Rate (MAPR) for a loan with a fixed payment. For example, a closed-end mortgage loan that is a home improvement loan under § 1003.2(i) may also be a refinancing under § 1003.2(p) if the transaction is a cash-out refinancing and the funds will be used to improve a home. The "annual percentage rate,"using that term spelled out in full. Auto loans and boat loans are common examples of closed-end loans. The interest rate is calculated on a daily basis, like your credit card, and is . Following up a close ended question with "I don't know" making it awkward for both parties often times. Instead, the shares can be purchased and sold only in the market, which is the original design of the mutual fund, which . In these cases you would ask questions like: Do you like our service? B)A department store credit card. Our site is great except that we don't support your browser. The law also . 172) A good example of a closed-end credit is: A. a credit card issued by a department store. offering open-end credit, such as credit cards or home-equity lines, or closed-end credit, such as car loans or mortgages. She is using A. 30 examples of open-ended questions. Download All 209 "end credits" video templates unlimited times with a single Envato Elements subscription. Open-end credit agreements are also. The loan may require periodic principal and interest payments, or payment of the entire principal at the end of the loan term. All the closed questions in the left column can be answered with a one-word answer, specifically Yes or No. With a closed-end loan, you borrow a specific amount of money for a set period of time. Closed-end funds are a type of investment company whose shares are traded in the open market like a stock or ETF. Paying the full amount due every month is not required . For those of you who follow my work, you are aware of my strong belief in developing an insatiable curiosity that will assist you in becoming innovative, prolific, and successful. She is using Closed-end credit. Examples Examples of closed-end loans typically appear in installment loans. For example, to pull up an existing customer's account information you could ask, "May I please have your account number?". payday loan title loan home loan credit card. H-12 Refinancing Sample. Miami, FL 30008. For example, an auto loan is a type of closed-end credit that must be used to purchase an auto. The Basics of Closed-End Credit. H-13 Closed-End Transaction With Demand Feature Sample. To be approved for closed-end credit, the lender will check your credit history. For example, if a customer fails to repay an auto loan, the bank may seize the vehicle as compensation for the default . On the other hand, if a closed-end consumer credit transaction is not secured by real property or a dwelling (for example, if it is unsecured or secured by an automobile), the creditor discloses a payment schedule in accordance with § 1026.18(g) and is not subject to the requirements of § 1026.18(s) or §§ 1026.37(c) and 1026.38(c). A personal loan, by comparison, is closed-end credit that you can use however you like. For example, when advertising closed-end credit products such as mortgages or auto loans, lenders are required by Subpart C of the TILA to include disclosures when they mention the following triggering terms: The amount or percentage of any down payment: For example, . E. a mortgage loan. You grab your Best Purchase credit card, which has an annual interest rate of 18%. Types of Credit Options. Dear Sir or Madam: The purpose of this letter is to serve as a written notice I am terminating my credit card account effective immediately. ETFs launched about 25 years ago and are becoming . established a num ber of new requirements for open-end consumer credit plans. She will make 12 equal payments over the next year to pay for it. HELOC Example. 10 open-ended vs. closed question set examples for sales professionals. A closed-ended question offers, as its name suggests, a limited number of answers. For example, an answer might be "Yes.", "No.", "Blue.", or "The Great Fire of London". They cannot do that in a normal closed-ended loan. O b. B. a credit card issued by VISA or MasterCard. Closed-End Funds What is a closed-end fund? The difference between closed-end credit and open credit is mainly in the. When you're in sales, open-ended questions are good for understanding more about your customer and opening up a real dialogue. ing on whether the credit is open-end (credit cards and home equity lines, for example) or closed-end (such as car loans and mortgages). Please close the following account: D)Travel and entertainment cards E)All of these are examples of closed-end credit. Open ended questions examples as well as close ended questions examples. Unlike open-end funds, new shares in a closed-end fund are not created by managers to meet demand from investors. H-10 Credit Sale Sample. to Close table, Summaries of Transactions, Borrower's Transaction, Seller's Transaction, Escrow Account, Loan Calculations, and Confirm Receipt. Question: Explain the concepts of closed-end credit and open-end credit. H-17(B) Debt Suspension Sample The right questions ensure that reps are building rapport, uncovering pain points, establishing need, and clearly articulating value. Another very useful type of closed question is a statement followed by a confirming question. Credit Card Cancellation Letter Sample. Both open-end and closed-end funds have been around for many decades. on certain closed-end mortgage loans bearing rates or fees above a certain percentage or amount. H-11 Installment Loan Sample. Overview. Example of a Line of Credit Agreement 6-30-99 2-FLP MT Amend. Unlike other mortgages, the HELOC functions like a credit card. Using a credit card issued by a store, a bank card such as VISA or MasterCard, or overdraft protection are examples of open-end credit. Comment: Closed End Credit is defined (226.2) as credit "other than „open-end credit‟". The terms on the loan depend on the borrower's credit rating and it is used for buying expensive things like cars and real estate. Regulation Z is structured accordingly. Assume that you have a previous charged balance of $285.76 (before interest has been applied) on the card. Molly purchased a $1,500 dishwasher from Best Appliances. The following are examples of closed-end mortgage loans and open-end lines of credit that are not excluded from reporting under § 1003.3(c)(10) because, although they primarily are for a business or commercial purpose, they also meet the definition of a home improvement loan under § 1003.2(i), a home purchase loan under § 1003.2(j), or a . Which of the following is an example of closed-end credit? Closed-ended questions are questions that can be answered with a short, fixed response. Also, includes changes to Revised Loan Estimate (Section 2.1.2) and Credit cards and personal loans are examples of unsecured loans. Closed-end, or non-revolving, credit provides a fixed amount of money to finance a specific purpose and period. An open-ended loan is one that allows you to continue borrowing funds that are paid back on an ongoing basis. Closed-end credit: is a sort of credit that must be paid back in full by the end of the term, on a specific day. Customer Service. 2. Closed-end credit B. Open-end credit C. Revolving check credit D. A line of credit E. None of the above Open-end credit, better known as revolving credit, can be used repeatedly for purchases that will be paid back monthly. In this post, I am going to break down a variety of closed-ended sales questions that you should avoid, followed by 35 examples of open ended sales questions that you should ask instead. Closed-end funds, however, may be less familiar to investors. A closed-ended question is narrow and typically elicits a "yes" or "no" response, which limits the quality of information given. As monthly installments are made, the balance owed to the lender decreases. Cannot travel overseas except only with the permission of the trustee. Closed-end credit is a type of credit that should be repaid in full amount by the end of the term, by a specified date. (Napoleonville, Louisiana, USA) It's time to go shopping! Closed-End Mortgage Advertising. Both forms of debt have their advantages and drawbacks. by Pam Lockett. So there we have it my friend. Perhaps the greatest disadvantage of using credit is The temptation to overspend. Can you run 5 kilometers? In an open-ended contract, there is no set pay-off period, there is no set payment, there is no set interest or finance charge, AND you get to re-use that part of your credit limit that you've paid off. By contrast, open-end loans such as credit cards can have the amount owed go up and down as the borrower takes money against a credit line. To better understand open-end credit, it helps to know what closed-end credit means. Closed-end credits include all kinds of mortgage lending and car loans On your shopping trip, you purchased three items: a . The best perk of open-end credit is its flexibility. A closed-end fund is a management investment With open-end, or revolving credit, loans are made on a continuous basis as you purchase items, and you are billed periodically to make at least partial payment. Like stocks, shares are traded on the open market. In each scenario, the borrower will receive a loan that is equitable to the cost of the item they are buying, be it a new home or a car. C)Overdraft Protection. Personal loans are also often close-end. § Coverage of closed-end credit transactions secured by a cooperative unit in various sections of the guide. Open-end credit is defined as credit extended under a plan in which: 1)The creditor reasonably contemplates repeated transactions; 2)The creditor may impose a finance charge from time to time on an outstanding unpaid balance; and 3)The amount of . Shares of closed-end funds frequently trade at a market price that is a discount to their NAV. Like stocks, CEFs are offered at an initial public offering. A closed-ended question. disclosure of payment examples if the loan's interest rate or payments can change, as well as disclosure of a . Question: Which of the following is an example of closed-end credit? For example, an auto loan is a type of closed-end credit that must be used to purchase an auto. Examples of non-revolving: most real-estate loans; car loans; appliance loans; and payday loans (small . Closed-end funds may trade at a discount (or premium) to their NAV and are subject to the market fluctuations of their underlying investments. I hope you enjoyed the article and got a lot out of it. For this hybrid product, the HELOC portion is 65%, while the amortizing mortgage portion is 15%. Mathematics, 21.06.2019 18:40 . give two examples of each. Repayments on this type of consumer credit are usually made in equal installments. If the annual percentage rate may be . Installment closed-end credit is used for a defined time period and amount. A closed-end credit is a loan in which the amount is borrowed all at once and the total balance with the interests have to be paid in a specific date. D. using a cashier's check to pay for a purchase. The use of positive numbers also triggers further disclosure: e.g. Credit cards, home equity loans, personal lines of credit, and bank account overdraft protection are all examples. For example, you may. Subpart A (sections 226.1 through 226.4) of the regulation provides general information that applies to open-end and closed-end credit transactions. Explore some open-ended questions examples vs. closed-ended ones, so you'll be clear on the difference and have an idea of how to change one type of question to the other. It just depends on how deep of an answer you are seeking. Below is the information for homeowner A: The appraised home value is $1,250,000. Open/Closed End Credit Card. Repayments on this type of consumer credit are usually made in equal installments. For more specific information reference Truth in Lending (Regulation Z) Subpart C - Closed-End Credit Advertising. Which of the following is an example of closed-end credit? HELOC-Open-ended for flexibility. H-14 Variable-Rate Mortgage Sample (§ 1026.19(b)) H-15 Closed-End Graduated-Payment Transaction Sample. Closed questions are useful when you are needing a specific response or a simple yes or no. Installment Closed-End Credit. Closed-ended questions are good for getting prospects to let you know whether they have any intentions of signing a contract any time soon. 1 Page 2 c. Borrower, prior to his application for a draw upon the LOC, shall provide the Bank with a budget and financial statement and such other financial records, accountings and books as the Bank shall deem . "12 percent Annual Percentage Rate", or "a $15 annual membership fee buys you $2,000 in credit". Open ended vs. closed ended: With revolving credit, you can use the line of credit repeatedly—up to a certain credit limit—for as long as the account is open. Select one: a. Answers: 2 Show answers Another question on Mathematics. Installment closed-end credit is used for a defined time period and amount. In a closed-end credit, the amount borrowed is provided to the borrower upfront. The choice of which type of credit to use will ultimately come down to why you need to borrow money and how flexible your purchase and repayment needs are. (p. 147) Molly purchased a $1,500 HDTV from Best Appliances. Unsecured personal loan b. A repayment example may also be stated as a unit cost: "60 monthly payments of $30.25 per $1,000 borrowed." These examples can be incorporated into the body of the advertisement or reference in the disclosures. Finance charges are based on your changing balance and can change on the bank's whim. Here's an example: on the left- hand side, you have closed-ended questions; on the right-hand side, each question has been tweaked into an open-ended version that allows respondents to elaborate further. Bloom's: Comprehension Difficulty: Medium Learning Objective: 2 Topic: Types of credit 70. Is London the capital of England? C. using overdraft protection at a bank. A closed-end mortgage loan or an open-end line of credit may be used for multiple purposes. Closed-End Credit. Which is an example of closed-end credit? Installment Closed-End Credit. In other words, the researcher provides . Closed-ended questions are often used in multiple-choice tests or surveys, especially when computers are used to process the test or survey. For example: i. If any triggering term is used in a closed-end credit advertisement, then the following three disclosures must also be included in that advertisement: 1. Close-ended questions, open-ended questions, and dichotomous questions are examples of good survey questions that you can add to your online shopping survey. A closed-end fund (CEF) or closed-ended fund is a collective investment model based on issuing a fixed number of shares which are not redeemable from the fund. It sets forth definitions and Shares of CEFs are traded on the open market. Bank issued credit card c. Department store credit card O d. Revolving lines of credit Which of the following is not a consequence of bankruptcy? An open-ended question is broad and provokes a unique answer. . The amount or percentage of the down payment; 2. Why It Is Important One should not confuse a closed-ended question for a probing question. Examples of Closed-End Loan Funds Some of the most common examples of closed-end loans used today are home mortgages and auto loans. These include: Loans for business purposes (for example, a loan to start a business), investment or leisure purposes (such as a vacation home or investment property), or consumer purposes (for example, a loan to purchase a home) H-17(A) Debt Suspension Model Clause. Open-End Credit vs. Closed-End Credit Disclosure Forms - Transactions under §§ 1026.19(e), (f) For a closed-end credit transaction subject to §§ 1026.19(e) and (f), (opens new window) determine whether the credit union provides disclosures required under § 1026.37 (opens new window) (Loan Estimate) and § 1026.38 (opens new window) (Closing A personal loan, by comparison, is closed-end credit that you can use however you like. They have a set interest rate, usually determined by the credit score and other financial information provided on the loan application. The two major categories for consumer credit are open-end and closed-end credit. MAPR is a standard calculation used by lenders for loans covered by the Department of Defense's Military Lending Act & Regulation Z. Conclusion To Open Ended Questions Examples. A creditor may use a unit-cost approach in making the required disclosure, such as "48 monthly payments of $27.83 per $1,000 borrowed." ii. 7806 Credit Avenue. Select one: a. The rule covers applications for closed -end or open-end credit secured by a first lien on a dwelling. When you take out a HELOC, you receive a maximum line of credit that you may access whenever you want. In an advertisement for credit secured by a dwelling , when any series of payments varies because of the inclusion of mortgage insurance premiums, a creditor But with nonrevolving credit, you can borrow the amount only once. Nonrevolving credit is also known as installment credit. The credit is obtained for a particular purpose, and the borrower is required to pay the entire loan, including the interest and maintenance fees, at the end of the set period. Open-End Credit Pros and Cons. The repayment includes all the interests and financial charges agreed at the signing of the credit agreement. . Closed-end funds are subject to management fees and other expenses. The biggest example of this type of loan is a credit card. Open-end credit is defined as credit extended under a plan in which: 1)The creditor reasonably contemplates repeated transactions; 2)The creditor may impose a finance charge from time to time on an outstanding unpaid balance; and 3)The amount of . • Subpart A—Provides general information that applies to both open-end and closed-end credit transactions, including definitions, explanations She will make 12 equal payments over the next year to pay for it. Conversely, home equity lines of credit (HELOC) and credit cards are examples of open-end credit. This problem has been solved! This isn't necessarily a bad thing. Closed-end loan A closed-end loan is a type of loan in which a fixed amount is borrowed and then paid back over a specified period. Several provisions of the Credit Close-Ended Questions. Generally, real estate and auto loans are closed-end credit. To be approved for closed-end credit, the lender will check your credit history. May 04, 2020. For example, "Can you tell me what happened next?" is a closed question and may be answered with a straightforward, "No." Reword the question to ask, "What happened next?" This type of probing question encourages a more elaborate response with supporting details. Examples of closed-ended questions As opposed to open-ended questions, closed-ended questions can only be answered with a very specific response, which is typically " yes " or " no. 3. Comment: Closed End Credit is defined (226.2) as credit "other than „open-end credit‟".
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