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WorksheetsCredit & Debt Review
Total questions: 18
Worksheet time: 10mins
Which of the following will help you build a credit history? Choose all that apply.
Credit card
Secured credit card
Auto loan
Debit card
Which of the following statements comparing credit and debit cards is TRUE?
Businesses accept credit cards more often than debit cards.
Credit card companies provide you with a monthly statement while debit cards do not.
When you use a credit card, the money comes directly from your bank account.
With debit cards, you are spending your own money, with credit cards you are promising to pay the money back.
If you do not choose a repayment plan for a Federal student loan, it will default to the Standard Plan which has a term of __________________.
10 years
5 years
10%
5%
When borrowing money, the longer your term length, the _______________ your monthly payments and the _______________ the total interest you will pay.
lower, higher
lower, lower
higher, lower
higher, higher
Which of these credit payback strategies would lead to the LOWEST interest charges?
Paying 20% of of your credit card balance every month on time
Making the minimum payment (3% of your balance) every month with an occasional late payment
Paying off your credit card bill in full every month
Making the minimum payment (3% of your balance) every month on time
Johnny is considering purchasing a $20,000 truck. Which of the following finance options will likely lead to the LOWEST monthly payment?
$5000 down payment, 5% interest for 84 months
No down payment, 5% interest for 60 months
$5000 down payment 5% interest for 60 months
No down payment, 0% interest for 36 months
You have been approved for a credit card and receive the following disclosure with your new card: "Your due date is at least 25 days after the end of the billing cycle. We will not charge you interest on new purchases provided that you have paid your previous balance in full by the due date each month." Which of the following statements is true?
If you pay your previous balance in full after the due date, the credit card company will not charge you interest.
If you make your credit card payment before the due date, you will be charged interest regardless of the amount of your payment.
If you make the minimum payment on your card with the 25 day period, the credit card company will not charge you interest.
The 25 days after the end of the billing cycle is referred to as the grace period.
Cindy and Bill each buy a house in the same neighborhood for $200,000. Cindy's mortgage payment is $400 less than Bill's. What could explain the difference?
Cindy chose a longer term for her mortgage, so her monthly payments are lower.
Cindy made a larger down payment, so her monthly payment is also larger.
Bill made a larger down payment, so his monthly payment is larger.
Cindy has a lower credit score, so her interest payments are also lower.
Select the statement below that accurately describes a characteristic of a credit card.
You must have money deposited into a checking account to use the credit card for purchases.
Making full payments on time every month is the only way to avoid interest charges.
You owe the same payment every month.
They do not charge interest.
Which factors account for 65% of your credit score?
Payment history and amounts owed
Amounts owed and length of credit history
Length of credit history and types of credit
Payment history and length of credit history
Which of the following would show up on a credit report? Check all that apply.
Credit card payment history
Salary of your current job
Student loan activity
Payment history of your car loan
Your friend ask you for advice to help him raise his credit score. Which of these is the BEST way for him to improve his score?
Check his credit score
Get a car loan
Cancel his credit cards
Make his monthly payments on time.
You currently have a credit card and want to boost your credit score. Which of the following will have the GREATEST impact?
Make the minimum payment required on your credit card every month by the due date.
Put the credit card in a drawer and don't ever use it.
Using less than 30% of the credit limit on your card and paying it off in full every month by the due date.
Always carry a balance from month to month.
If you make a late payment on your credit card bill, how long will that payment information be on your credit report?
It will disappear once the payment is made
One year
Five years
Seven Years
Who tracks all of your credit information?
Consumer Protection Agency
Lenders
Federal Government
Credit Bureau such as Equifax, Experian, TransUnion
Which of the following could have a NEGATIVE impact on your credit score?
Decreasing your utilization of credit
Applying for multiple credit cards in a short period of time
Paying down balances on your credit card accounts
Paying your bills on time
Which of these represents a potential consequence of neglecting to pay your debts?
Wages or tax refunds can be garnished
Collection agencies can try to collect your debt from your family and friends
Lose your job
Lender can file bankruptcy on your behalf
What impact can your credit score have on your financial situation?
Your credit score can be used to determine whether you are approved for a loan and the interest rate of the loan
Your credit score does not impact your financial situation
Consumers with high credit scores can borrow money and those with low scores cannot
Consumers with low credit scores get lower interest rates on loans than those with high credit scores
