金融市场与机构(第六版)教师手册M26_MISH1438_06_IM_C.pdf

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1、Chapter 26 On the Web:Finance Companies History of Finance Companies Purpose of Finance Companies Risk in Finance Companies Types of Finance Companies Business(Commercial)Finance Companies Consumer Finance Companies Sales Finance Companies Box 1:The Expansion of Ford Motor Credit Regulation of Finan

2、ce Companies Finance Company Balance Sheet Assets Liabilities Income Finance Company Growth Finance companies are discussed as an important element in the growing economy.Finance companies allow individuals with smaller pocketbooks to borrow money to purchase items they would not otherwise be able t

3、o buy.They are usually called a financial intermediary because they borrow large amounts,but lend small amounts to individuals and businesses.High-risk customers are often more accepted at finance companies for loans offered at higher interest rates.Finance companies are divided into three types:bus

4、iness,sales,and consumer.Factoring is a type of provision of credit where the factors buy accounts receivables.Also,they provide leases and floor plan loans.Consumer finance companies usually finance customers with bad or no credit to purchase such items as furniture or home appliances.Point out to

5、students that customers who go to consumer finance companies will pay a higher interest rate because they are at higher risk of default.In-house credit and credit card companies including Ford Motor Credit are excellent examples of sales finance companies.Since finance companies do not have deposito

6、rs,they are not regulated heavily by the government.However,they must disclose the costs of the loan and limit the rate of the interest.When collecting delinquent and defaulted loans,finance companies must follow state and federal government regulation.Chapter 26 On the Web:Finance Companies 155 1.A

7、 balloon loan requires that a single large payment be made when the loan matures,whereas on an installment loan,the borrower makes a series of small,equal payments.2.Automobiles began to be mass-marketed and consumers needed loans to purchase them.3.They often have poor credit records,low incomes,or

8、 inferior security.All of these factors make them unacceptable to banks.4.Consumer finance companies often charge far higher interest rates than banks.5.Yes,because there is no well-established secondary market for their loans.6.Finance companies face little interest-rate risk because they tend to m

9、ake short-term loans which are not affected much by interest-rate changes.7.Factoring is selling accounts receivable to a finance company.The selling firm gets immediate cash for its sales and avoids having to go after its customers for collections.8.The finance company making the lease will find it

10、 easier to repossess the assets if a default occurs.The firm leasing the asset may be able to conserve cash in that no down payment may be required.9.Under a floor plan,the finance company holds the inventory as security and releases its lien on the inventory only when the items are sold and the loa

11、n is paid.10.They are sales finance companies.11.The tax code allows the interest paid on loans secured by homes to be deducted from taxes.This lowers the effective cost of the debt.12.Finance company customers frequently file bankruptcy because they often have few assets to lose.The bankruptcy can make collection on the loan impossible and often delays retrieval of collateral.13.Regulation Z requires that the company disclose the annual percentage rate charged on loans in a prominent and understandable fashion.14.Usury statutes limit interest rates