Wise Practice Test (Credit)

Front

When a person brings an item to a pawnshop to obtain cash, the transaction is considered

Back

a collateralized loan.

Front

Which of the following is considered to be open-end credit? A. A mortgage. B. A car loan. C. Department store charge cards. D. Installment loans.

Back

Department store charge cards.

Front

What is meant by an uncollateralized loan?

Back

A personal loan without assets to cover the loan amount.

Front

A person has three credit cards with very large outstanding balances and is unable to make payments on any of them. Which action should the person take? A.  Notify a credit reporting agency in order to avoid a late fee., B.  File for bankruptcy in order to maintain ones current credit score., C.  Notify the credit card companies in order to negotiate a new payment plan., D.  Contact the Internal Revenue Service in order to avoid paying income tax this year.

Back

Notify the credit card companies in order to negotiate a new payment plan.

Front

To qualify for a Federal Housing Administration (FHA) loan, a person must generally fulfill income guidelines.

Back

fulfill income guidelines.

Front

When a person declares bankruptcy, how long will that fact appear on the person's credit report?

Back

for a 10 year period.

Front

Collateral is:

Back

Something of value that secures a loan to protect the lender.

Front

A creditor determines your creditworthiness based on: Character, collateral, and capacity, Address, Gender, Education

Back

Character, collateral, and capacity

Front

Most Consumer Credit Counseling Services (CCCS):

Back

Charge a fee for setting up and administering a debt repayment plan

Front

How can you avoid becoming a victim of identity theft? A. Avoid giving your Social Security number on a phone call you did not initiate, B. Leave your wallet containing personal information where it can be stolen, C. Keep your PIN on your ATM card, D. Avoid using your credit card to charge purchases on the phone

Back

Avoid giving your Social Security number on a phone call you did not initiate.