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WorksheetsCredit, Debt, and Loans
Total questions: 15
Worksheet time: 8mins
Which of these is the best definition of credit?
An amount of money owed by one person or party to another person or party
A financial tool that allows people access to money that they do not currently have
A fee that a lender charges a borrower for the service of borrowing money
A grant or payment in support of an education that you do not have to pay back
Which of these types of loans are generally considered to use predatory lending tactics/strategies?
Installment loans
Payday Loans
Promissory Notes
Secured Loans
What does a credit score mainly show to lenders?
How many credit cards I have open
My overall creditworthiness (how reliable or trustworthy I am with credit)
How many years I have had my credit card
Which types of loans I take out most often
What is the typical relationship between the riskiness of a loan and that loan's interest rate?
The lower the risk for the lender, the higher your interest rate will be
The higher the risk for the lender, the higher your interest rate will be
The higher the risk for the lender, the less likely it will be that you will pay interest
There is no relationship between the two
Which is considered riskier for a lender, a secured loan or an unsecured loan?
Secured Loan
Unsecured Loan
Which of the following MAY request a credit score check?
Landlord or landlady
Mortgage or auto loan officer
Certain employers
All of these
Which of these is the most heavily weighted (most important) part of a credit score?
Amounts owed
Payment history
Mix of credit types
Length of credit history
When talking about credit cards, your "line of credit" is:
The number of cards you have open at a given time
The amount of money your bank/credit union is willing to lend you over a set period of time (such as a month)
The minimum payment required on a credit card statement
The number you call if your credit card is stolen
Which of these types of loans will never require collateral?
Installment Loan
Secured Loan
Promissory Note
Unsecured Loan
What is the best definition of collateral?
An item of value used to secure a loan
The amount of money your bank is willing to lend you over a set period of time
Another term for a missed credit card payment
How often I make my credit card payments on time, and in full
I applied for an auto loan with a credit score of 350. I will most likely be approved for the loan and pay a low interest rate
True
False
Which of these would NOT typically be seen as an example of "good" debt?
A student loan
A mortgage (home loan)
A car loan
A business loan
Debt is seen as "good" if it...
Is for something we really want
Has a good chance of increasing our net worth or income
Is used to purchase a depreciating asset
Is about 50% of our yearly income
Which of these types of loans are ALWAYS repaid by a series of fixed payments?
Unsecured Loan
Installment Loan
Secured Loan
Promissory Note
One person lending money to another might want to write up one of these to document the loan and make sure it's legally binding
Personal check
Promissory note
Payday loan
Affidavit
