Build: Credit Fundamentals

Which of these are long-term impacts of having a good credit history?

• It lets you buy the things you want like clothes or cellphones.

• It gives you freedom to shop around for the best deal on tech.

• It prevents you from spending money on things you want instead of things you need.

• It's easier to pay for major purchases like cars, houses, and education.

Which action could help improve your credit history?

• Leave credit card bills outstanding.

• Always pay your credit card bill on time.

• Only get a debit card and avoid credit cards.

• Make a major purchase that you can't afford right now

What is the correct definition for the grace period?

• The amount you pay for your card each year

• The amount of time you have to make late payments

• The time between when you make a purchase using the credit card and the date when the credit card company begins charging you interest.

• The amount of time you have to pay your secured deposit

Why is it important to find a credit card with a lower APR?

• A lower APR means you have more time to pay off your balance.

• A lower APR gives you a better credit history.

• A lower APR impacts your grace period.

• A lower APR means you pay less in interest.

Why do lending and credit card companies use a borrower's Social Security number when opening an account?

• To withdraw taxes

• To assign an interest rate

• To protect against fraud

• To ensure borrowers are US citizens

What is a reason to pay more than the minimum payment due on your credit statement each month?

• You save money on interest.

• It takes more time to pay off a balance.

• It hurts your creditworthiness.

• Your credit utilization rate stays the same.

Which statement is correct about Annual Percentage Rate (APR) ?

• It is better for the borrower if the rate is higher.

• It stands for Amortized Percentage Rate.

• It is the interest rate you pay on balances you carry over from month to month.

• It has nothing to do with how much interest you pay.

What statement is correct about grace periods? A. B. C. D.

• Every credit card has a grace period.

• You are charged interest during the grace period.

• A short grace period is better for the borrower.

• A grace period is the time between making a purchase and when the company begins charging you interest.

Which is the best strategy for paying your credit card bill?

• Pay the entire balance every month.

• Pay half the balance every month.

• Pay the minimum payment every month.

• Make no monthly payments at all.

Which action is best if you suspect you're the victim of identity theft?

• Check your credit report

• Change your email address

• Get a PO box

• Change your phone number