Credit and Loans

What does defaulting mean?

• Getting a good credit score

• Building credit history

• Failing to pay your debts

• Opening many credit card accounts at the same time

Non-installment credit is described how?

• Credit when the borrower makes regularly scheduled monthly payments in the same amount

• Credit that lets the borrower choose how much of the credit to use and when to pay it

• Credit that is paid all at once, in a single payment within a specific time period without interest

• Credit that is granted with a very high interest rate

Which of the following is a part of the process of establishing credit?

• Talking to a bank teller

• Checking your credit rating

• Using credit wisely

• Applying for a department store credit card

Define financing

• Paying back all debts

• Using credit to pay for purchases

• Using a debit card to make a purchase

• Reducing the principal of a loan

Define collateral

• Collateral is an asset or group of assets that are linked to a loan

• Collateral is a finance charge

• Collateral is a down payment

• Collateral is a specific type of home loan

Which is the best credit score?

• 500

• 850

• 300

• 700

Which is NOT part of your credit report?

• Your bank balance

• Your current home address

• The number of times you have filed for bankruptcy

• The number of inquiries made about your credit

If you are unable to get a major credit card like Visa, Mastercard, etc., what might you do?

• Stop accepting government assistance

• Apply for a department store card

• Pay less attention to your bank accounts

• Make as many cash purchases as possible

If you are too young to be granted credit yet, you need a loan to purchase an expensive item like a car, what might you do?

• Ask a friend/family member, to co-sign on the loan

• Request your credit history

• Allow someone else to apply for the loan for you

• Open two lines of credit at the same time

What does a credit counselor do?

• Co-signs a loan with you

• Collects debt

• Convinces your creditors to reduce your debt

• Helps you make a plan to resolve financial issues