Credit Report, Rate and Borrowing Quiz

What is credit?

• Receiving goods or services in exchange for a promise to pay in the future

• Receiving goods or services in exchange for immediate payment

• Receiving goods or services for free

• Receiving goods or services in exchange for a loan

Why do you need credit?

• To get a job

• To avoid paying for goods and services

• To build a good credit score

• To get free goods and services

What is a credit score?

• A number that represents your income

• A number that shows how much money you owe

• A number that shows your spending habits

• A number that evaluates how much of a risk it is to lend you money

What makes up the majority of your overall credit score?

• Total Debt

• Credit History

• New Credits and Inquiries

• Payment History

What is the range for FICO credit scores?

• 200-700

• 100-500

• 400-900

• 300-850

What can affect your ability to get a job or rent a home?

• Education level

• Age

• Income level

• Credit score

What is the impact of having a bad credit score on loan interest rates?

• Interest rates remain the same

• No impact

• Lower interest rates

• Higher interest rates

What is the recommended action if your credit report contains errors?

• Ignore the errors

• Apply for more credit

• Contact the reporting creditor and all three reporting agencies

• Close out old accounts

What is the most important factor in improving your FICO score?

• Applying for unnecessary credit

• Using balance transfers

• Closing old accounts

• Paying on time

What is the recommended approach for improving a low credit score?

• Close all old accounts

• Use balance transfers frequently

• Apply for as much credit as possible

• Start slow and set achievable goals