Credit & Debt Review

Front

A three-digit number (ranging from 300-850) based on an individual's credit history

Back

Credit Score

Front

The rate charged for borrowing money, usually expressed as a percent of the amount borrowed. The "extra" amount you pay on a debt.

Back

Interest rate

Front

The amount of money you borrow from a lender, this does not include interest.

Back

Principal

Front

The length of a loan agreement. Ex: Your home mortgage is a 30 year loan

Back

Term

Front

A method of debt repayment whereby the borrower prioritizes paying down debts with the smallest balances first

Back

Debt snowball method

Front

The maximum amount that may be borrowed on a credit card

Back

Credit Limit

Front

Credit utilization is a measure that shows what percentage of your credit limit you are using. It is generally recommended to keep your credit utilization below...

Back

30%

Front

Which is more important, to establish a high credit score, or to limit your debt as much as possible/be debt free?

Back

Limit your debt as much as possible/be debt free

Front

This is what we call a loan to buy a house

Back

Mortgage

Front

What are the two most important factors in calculating your credit score?

Back

Payment history and amounts owed (utilization)