Credit Review

Ava, Noah, and Priya are applying for a loan. Why would the lender check their credit history?

• To assess the risk of lending money to Ava, Noah, and Priya

• To assess Ava, Noah, and Priya's education level

• To evaluate Ava, Noah, and Priya's income

• To determine Ava, Noah, and Priya's age

Michael is considering getting a credit card. Nora, who already has one, is explaining the benefits to him. What might she say?

• She might say that the benefits are higher interest rates, limited acceptance, and increased debt.

• She might say that the benefits are convenience, building credit history, earning rewards, and fraud protection.

Tags

CCSS.RL.11-12.3

CCSS.RL.9-10.3

CCSS.RL.8.6

CCSS.RL.7.6

CCSS.RL.6.3

Abigail needs to buy a car and is considering two types of loans: a secured loan and an unsecured loan. What is the difference between these two types of loans?

• A secured loan has a higher interest rate than an unsecured loan.

• A secured loan requires a co-signer, while an unsecured loan does not. In this case, Grace could co-sign for Abigail.

• A secured loan is backed by collateral, such as Charlotte's car, while an unsecured loan is not.

• A secured loan is only available to individuals with good credit, like Charlotte, while an unsecured loan is available to anyone, including Abigail and Grace.

Benjamin wants to improve his credit score. How is his credit score calculated?

• Credit score is calculated based on the number of credit cards Benjamin has.

• Credit score is calculated based on the number of times Benjamin has applied for a loan.

• Credit score is calculated based on the amount of money Benjamin earns.

• Credit score is calculated using various factors such as payment history, credit utilization, length of credit history, types of credit used, and new credit inquiries.

Benjamin is applying for a loan and the bank requests his credit report. What information can the bank expect to find in Benjamin's credit report?

• Medical history, criminal records, and political affiliations.

• Personal identification details, credit accounts, payment history, public records, and inquiries.

• Social media activity, online shopping history, and travel records.

• Credit scores, employment history, and income details.

Lily, Abigail, and Ethan are discussing ways to maintain a good credit score. Which of the following actions can negatively impact their credit scores?

• Paying off their credit card balance in full every month

• Having a long credit history

• Applying for a mortgage loan

• Late or missed payments, high credit card balances, applying for too much new credit, and having a short credit history.

Scarlett has just received her first credit card. She notices a term 'credit limit' on her card. What does this 'credit limit' mean?

• It sets a maximum borrowing or spending limit for Scarlett.

• It increases Scarlett's chances of getting approved for a loan.

• It helps Scarlett to track and manage her expenses.

• It allows Scarlett to earn rewards and cashback on her purchases.

Isla is planning to take a loan for her new car. Benjamin explained to her about the role of interest rates in loans. Which of the following statements correctly represents what Benjamin might have told her?

• Interest rates in loans have no impact on the cost of borrowing money.

• Interest rates in loans determine the repayment schedule.

• Interest rates in loans are determined by your credit score, Isla.

• Interest rates in loans determine the cost of borrowing money, Isla.

Scarlett is looking for ways to improve her credit score. What advice would you give her?

• She should pay her bills late, increase her credit card balances, apply for new credit frequently, close old accounts, and never check her credit report.

• She should pay her bills on time, reduce her credit card balances, limit new credit applications, keep old accounts open, and check her credit report regularly.

Noah is considering filing for bankruptcy due to some financial difficulties. Hannah, a financial advisor, is explaining the consequences to him. What did she say about the impact of bankruptcy on Noah's credit score?

• Bankruptcy has no impact on your credit score.

• Bankruptcy can significantly lower your credit score and stay on your credit report for several years.

• Bankruptcy can improve your credit score.

• Bankruptcy only affects your credit score if you have a high income.