CRM UNIT 4 TEST

Front

What is the Credit Utilization Rate?

Back

A measurement of your outstanding debt divided by your total available credit.

Front

What does a Credit Score indicate?

Back

A number that judges how well you use credit and pay bills.

Front

Calculate the New Balance: Previous Balance is $1523, with a $35 overlimit fee, a $25 late fee, and a $200 payment made this month. Monthly interest rate is 2.17%.

Back

$1416.05

Front

What does the Avalanche Method involve?

Back

Putting extra money towards loans with the highest interest rate.

Front

What happens if you always pay more than the minimum payment on your credit card?

Back

You will pay less interest and pay your card off sooner.

Front

Define Bankruptcy.

Back

A legal status of a person or other entity that cannot repay the debts it owes to creditors.

Front

What is Credit History?

Back

A record of a borrower's responsible repayment of debts.

Front

What is the purpose of a Credit Report?

Back

To provide a detailed account of an individual's credit history, including credit accounts, payment history, and outstanding debts.

Front

What is the difference between secured and unsecured credit?

Back

Secured credit is backed by collateral, while unsecured credit is not.

Front

What is an overlimit fee?

Back

A charge incurred when a credit card holder exceeds their credit limit.