Credit Test

Dawn graduated from high school and wants to get a credit card. How can Dawn establish credit-worthiness?

• Opening a checking account, making regular deposits, and avoiding penalties for insufficient funds

• Be extremely careful about disclosing account information

• The Truth in Lending Act of 1968

A measure of a person's ability and willingness to pay debts on time. 

• credit rating (score)
• collateral 
• credit limit

something of value the bank can take if the borrower does not make the required loan payments.

• collateral
• interest
• commercial credit

a person who lends money or provides credit

• creditor
• debtor
• interest

someone who borrows money or uses credit

• creditor
• debtor
• interest

Which type of loan below would be considered an Installment Plan? (Hint: Installment plans have a set payment every month until they hit $0)

• A car loan that will expire after all payments are made

• A Home Depot credit card that gives you a $5,000 limit and doesn't expire

• A Visa gift card with a set amount of $100

• Taxes on goods and services

John has an excellent credit score. He pays his bills on time and has very little debt. Which credit score below would be considered an excellent credit score?

• 400

• 150

• 800

• 550

What are some negative consequences of having a low credit score?

• Your interest rates on loans or credit cards will be higher and getting a loan will be harder

• Your interest rates will be lower

• No one will loan you money

• Getting a loan will be easier

which statement below best describes an Annual Percentage Rate?

• It always shows up in the form of a decimal

• It is the annual percentage fee you will be charged for borrowing money

• It is the upfront downpayment you have to pay for buying a car

• It is free money the bank will give you for being a customer

Which card attaches to someones bank account?

• Debit Card

• Credit Card

• Credit Report

• Home Depot Credit Card