Using Credit Flashcard

Front

Lucia doesn't have any credit cards, current loans, or debt. Given this information, it is likely that Lucia's FICO score is high.

Back

False

Front

Which of the following will not help you establish a good credit history?

Paying your phone bill on time

Financing a car and making payments on time
Making as many purchases as possible with cash

Never exceeding your credit limit on your credit card

Back

Making as many purchases as possible with cash

Front

For creating credit scores, credit bureaus rely on a model created by the Fair Isaac Corporation.

Back

True

Front

Credit scores in the 500-600 range will result in

Back

higher interest rates.

Front

Which is NOT an advantage of credit? Emergency Resources, Hedge Against Inflation, Convenience, Decreases Consumption

Back

Decreases Consumption

Front

Which of the following credit scenarios will lead to the best deals (i.e., a case where the borrower ends up paying back less money)? Options: Marshall is offered a credit card with an introductory 0% APR for 12 months and then a rate of 17% thereafter. He borrows $2000 and pays it back in 6 months. Andrea is offered a credit card with 14% APR. She spends $2000 on the credit card, and pays it back in 12 months. Marco is offered a credit card with a 8% APR. He spends $3000 and pays it back in exactly two years. Tony is offered a credit card with an APR of 15% and an annual fee of $35. He spends $1700 and pays it back in 18 months.

Back

Marshall is offered a credit card with an introductory 0% APR for 12 months and then a rate of 17% thereafter. He borrows $2000 and pays it back in 6 months.

Front

Leon has a FICO score of 590, and Nicole has a FICO score of 700. Which of these potential borrowers will be seen as the better risk to a lender?

Back

Nicole

Front

A credit limit is the maximum amount of money that a lender will allow a borrower to use via a loan or credit card.

Back

True

Front

Which of the following is not a kind of information provided on a credit report? prior bankruptcies, repayment history for each previous loan or credit card, savings history

Back

educational history

Front

Making regular deposits into a savings account does not enhance one's credit score.

Back

True