Credit

Using which of the following DOES NOT help you build a credit history?

• Debit Card

• Credit Card

• Secured Credit Card

• Authorized user on parents Credit Card

Which of these statements best explains why it's often a good idea to pay more than the monthly minimum amount on a loan?

• The extra payment will be applied to the interest you owe, which will increase the overall cost of your loan

• The extra payment will be applied to the principal amount you owe, which will pay down your debt more quickly

• Every time you pay extra, the lender will reduce the interest rate they're charging by a small amount

• You should never pay more than the monthly minimum payment

Which of the following is true about fixed rates?

• Fixed-rates remain constant during the term length

• The interest rates can change during the duration of the loan

• Fixed rates remain the same for only 1 year then increase

Mary is considering buying a $20,000 car.  Which of these financing options will likely lead to the LOWEST monthly payment?

• 6% interest, 60 months

• 6% interest, 12 months

• 6% interest, 48 months

• 6% interest, 84 months

Which response best completes the sentence "It's best to begin establishing credit when you're young because ________" ?

• Interest rates will only continue to go up as you get older

• You want the lowest credit score possible

• Credit scores are free for anyone under the age of 25

• You will likely need a credit history to rent your first apartment, finance your first car, or open an unsecured credit card

What is defined as the amount you are borrowing?

• Term

• Principal

• Interest

• Outstanding

Which of the following factors does NOT determine the interest rate?

• Credit Score

• Loan Amount

• Gender

• Life Situations

Someone who agrees to take the responsibility of repayment if the loan goes unpaid.

• Authorized User

• Cosigner

• Lender

• Bank

Which of the following is defined as the total amount of money you can borrow?

• Principal

• Credit Limit

• Balance

• Interest rate

What is the credit score range?

• 0-850

• 300-800

• 300-850

• 500-850