Your Credit

Good credit gives you options. Bad credit takes away your options. Choose the one correct answer

• You have good credit. You can choose the credit card with the lowest interest rate.

• You have good credit. You are forced to take the credit card which charges rip-off rates.

• You have bad credit. You can easily get a store charge card.

• Bad credit can help you get better cars, loans and jobs.

What is a "debt-to-income" ratio?

• How much money you have to make every year in your job.

• How much money you owe in total versus how much you make.

• How much money you have to pay back on your income.

• How much money you owe on your student loan compared with how much you want to make in your job.

Which statement best illustrates how good credit can give you power?

• Having good credit makes others more dependent on you.

• Having good credit can lead to a better paying job and better interest rates on a loan, for a car, a home, etc.

• Having good credit makes you less independent.

• Having good credit gives you fewer opportunities than most.

With bad credit you are more dependent on others. Which statement is correct?

• Bad credit means you have more options on places to live.

• Bad credit means you don't have to pay your bills on time, since your credit is already bad. So, you can buy more things on credit.

• Bad credit means you may have to live at home with your parents for a long time. It also means you may have trouble getting a good job, and trouble getting a loan. And even if you get a loan, you will pay a lot more in interest.

• Bad credit means you always have to pay less for items like car insurance.

If you are renting an apartment with a roommate and all of the utilities are in your roommate's name why would your payments not help or hurt your credit rating?

• Because unless my name is on the account the credit bureaus do not recognize the payments.

• Because credit bureaus do not look at utility payments as a form of building credit worthiness.

• It will only count if I pay by check so that there is a documented transaction.

• It would help my credit rating.

Why do companies check your credit rating?

• To buy an ice cream cone.

• Because many companies believe your credit history lets them know if you would be a good or bad employee.

• To buy DVDs.

• All of the above.

Select the one statement that accurately describes credit bureaus (also called "credit reporting agencies").

• Credit bureaus keep records of your spending habits for seven to ten years.

• Credit bureaus are the companies that issue credit cards.

• Credit bureaus are not-for-profit agencies whose main purpose is to serve consumers.

• Credit bureaus are the institutions that issue driver licenses.

Because your credit rating is low, a company charges you more interest on a loan. But the interest rate is not directly related to your credit. This company charges you as much as it can, simply because they think you have no other choices. This is a definition of:

• Predatory lending.

• Risked Based Financing.

• Good Business.

• The way all credit companies and banks work.

Which of the following things will affect your credit score?

• Skipping payments on your cell phone account.

• Paying your bills on time.

• Paying your bills late.

• All of the above.

If you make a $500 purchase on a credit card the has a 5% APR, how much will you owe on that card if you do not pay it off before your "grace period" ends?

• $250

• $525

• $550

• $750