WorksheetsWhat is Credit? Things to know and its History
Total questions: 46
Worksheet time: 23mins
The first historical record of a loan (credit) was for....
agricultural purposes in 3500 B.C.
Cave man art found in the Swiss Alps in 6000 B.C.
Chinese farmers selling rice grains for promised cattle in 189 A.D.
loan on buying grains with a 33% interest in Babylon 1800 B.C.
An example of an "good" credit score would be
620
580
760
700
A mortgage is ...
a business that handles merchandise
a car loan
an operational part of a business
a loan for a house
Which of these are safer to use when shopping online?
debit card
checking account
savings account
credit card
Revolving credit is...
a type of credit that can be used repeatedly up to a certain limit as long as the account is open and payments are made on time.
a type of credit that can be used only once up to a certain limit and must be closed immediately after all payments are due
a spinning door with money in it
a round device that holds credit cards and spins, making it easy to shuffle through all your credit cards quickly
Which of the following could be a SECURED loan? (hint: choose 2 correct answers)
Auto loan
Student loan
Mortgage
Overdraft
If the collateral for your secured loan can be taken away, why get a secured loan at all?
Because they usually have a higher interest rate
Because they usually have a lower interest rate
Banks give you an extra 90 days to make a missed payment
Banks typically don't charge interest for the first 12 months
Credit Reporting originated to track debtors and help businesses identify good an bad customers. This was done by ...
... tailors in england in 1803.
... Ford Motor Company to get customres to pay car loans.
... a group of lords who wanted to control the land rights and payments of taxes by peasant tenants in 1428 A.D.
A loan which the borrower must repay the amount in a specified number of equal payments.
Title loan
Payday loan
Closed‐end credit
Refund anticipation loan
A line of credit established in advance so the borrower does not have to apply for credit each time new credit is desired.
Rent‐to‐own loan
Pawn loan
Open‐end credit
Refund anticipation loan
What type of credit score is this 570?
Average
Great
Poor
Excellent
An example of closed‐end credit is a secure credit card.
True
False
Examples of when credit, if used responsibly, can be a positive. (Check All that Apply)
Credit can provide long‐term benefits such as the opportunity to earn a higher income by attending college
Credit may allow individuals to make large purchases, such as an automobile, that allows them to get to and from work.
Having a credit card will allow an individual to make online purchases more securely and provide a source of open‐end credit in case of emergency.
Credit will not allow individuals to make large purchases, such as an automobile, that allows them to get to and from work.
A simple definition of credit could be stated as...
Buy now, pay now
Buy later, pay later
Buy later, pay now
Buy now, pay later
A creditor is a person who owes you money.
True
False
Is a thing that is borrowed, especially a sum of money that is expected to be paid back with interest.
Loan
Debt
Credit
Collateral
Is the ability of a customer to obtain goods or services before payment, based on the trust that payment will be made in the future.
Loan
Debt
Credit
Collateral
the first Bank of America Card ( now Visa) came out in ..
1948
1975
1945
1958
You are entitled to a free copy of your credit report twice a year.
TRUE
FALSE
What type of loan would one need to buy a house?
short-term
intermediate
long-term
none of the above
Which of the following defines credit?
Yearly membership or participation fees
fees for getting cash advances
the ability to acquire money, goods or services from others without immediate payment
loans which will be in repayment for less than an 18 month time period
Borrowers have five FICO scores--one for each of the credit bureaus.
TRUE
FALSE
Age is a factor in someone's FICO score.
TRUE
FALSE
A grace period is a free period which allows you to avid finance charges by paying your balance in full before the due date.
TRUE
FALSE
Which of the following is often used for operating expenses?
lump loans
short-term loans
intermediate-term loans
large loans
Which of the following is NOT a type of credit?
loans
debit cards
revolving credit accounts
credit cards
Which is an exceptional credit score?
672
555
713
813
There are different forms of credit such as loans and credit cards.
True
False
How can you establish credit?
Getting a credit card
Paying bills on time
Borrowing money
What is a "line of credit"
It tells how good your credit is
The amount you pay to borrow money
A limit to the amount you can borrow
What makes a person a good cosigner
A high credit score
A steady income
The ability to pay for your loan if you can’t
All of the above
The three biggest Credit Bureaus are attain universal coverage in 1980 are
Equifax
Experian
and TransUnion
Equifax
TransUnion
and Vis Universal
Equifax
Visa Universal
and American Express Holdings
Vis Universal
American Express Holdings and Experiana
The four types of Credit used in daily life are
mortgages
loans
overdraft
credit cards
loans
credit cards
promisory notes
I.O.U.'s
loans
mortgages
debit cards
promisory notes
open credit
Your credit score determines how successful you will be in obtaining a loan
True
False
Which one of these is NOT one of the 3 main Credit Bureaus?
Equifax
Experian
FICO
TransUnion
The highest FICO score possible is:
1600
1000
850
700
Bankruptcy can stay on your credit report for up to:
2 years
10 years
the rest of your life
it doesn't show up
Other than FICO, which other company creates credit scores?
McDonalds
FICO
Credit Karma
VantageScore
What makes a person a good cosigner?
A high credit score
A steady income
The ability to pay for your loan if you can’t
All of the above
