Understanding Credit and Borrowing

Front

What is one benefit of borrowing money from a friend or family member?

Back

They will typically work with you on a repayment plan.

Front

What is a key difference between a credit card and a debit card?

Back

Credit cards allow you to borrow money, debit cards come directly from your account.

Front

What question is MOST useful in helping decide if someone should get a credit card or bank loan?

Back

Are you trying to make many small purchases or 1 large purchase?

Front

Which statement about credit cards is TRUE?

Back

Credit cards will charge interest every month until the balance is paid in full.

Front

What can a person, who is under 18, do if they want a credit card?

Back

Be added as an authorized user on an adult's credit card.

Front

The longer your loan term, the _______ you pay in total. The higher your interest rate, the _________ you pay in total.

Back

More; more

Front

What is the best way to avoid going into large debt on your credit card?

Back

Pay your full balance every month.

Front

Which factor does NOT impact your credit score?

• Payment history
• Bank account balance
• Mix of credit types
• Length of credit history

Back

Bank account balance

Front

When applying for an auto loan, your credit score...

Back

affects the interest rate you will pay on the loan.

Front

Which statement about credit score is TRUE?

Back

high credit score will make it easier to get loans with better APR