WorksheetsCredit Review
Total questions: 30
Worksheet time: 10mins
The more credit cards I have, the higher my credit score will be.
True
False
All credit cards charge an annual fee and offer rewards.
True
False
The minimum age to be added as an authorized user on a credit card is 18.
True
False
Which of these is NOT one of the C's of credit?
Character
Credit Score
Capacity
Collateral
How do banks make money off of the credit they issue?
The charge a large, one-time fee at the start of the loan.
They take out a small fee each month from your bank account.
They charge interest that is factored into the monthly payment.
This is a trick question - they don't make money!
Which of the following is an example of an installment loan? (More than one answer is correct)
Mortgage
Auto Loan
Credit Card
Debit Card
Which of the following could be a SECURED loan? (There is more than one correct answer!)
Auto Loan
Student Loan
Mortgage
Payday Loan
What is an advantage to getting a secured loan?
They usually have a higher interest rate than unsecured loans.
They usually have a lower interest rate than unsecured loans.
Secured loans give you an extra 90 days to make a missed payment.
Secured loans don't charge any interest for the first 12 months.
Which of these will NOT impact the interest rate on your loan?
Your relationship with the financial institution.
Your credit score.
The principal amount of the loan.
Your ethnicity or gender.
Which of the following could reduce how much interest you pay in total on an auto loan? (There is more than one correct answer.)
Have a larger down payment
Have a smaller down payment
Choose a longer term length
Choose a shorter term length
Make additional payments towards the principal
When a loan is amortized, which of these makes up the larger portion of your early payments?
Principal
Interest
What might happen if you make late payments on your credit card? (There is more than one correct answer!)
Your credit score will go down.
The Annual Percentage Rate (APR) will increase.
A late fee will be charged to your balance.
All charges will be declined until you make a payment.
How can you avoid paying interest on your credit card?
Always pay the minimum payment by the due date.
Pay the interest first, then pay what you can on the remaining balance.
Always pay the full balance by the due date.
Pay the principal first, then pay what you can on interest.
Which is TRUE when you pay only the minimum amount to your credit card?
You are charged interest on the remaining balance.
Your credit line is restored to its maximum amount.
You pay off your debt faster.
You may not make any charges until you pay the full balance.
Which of these will make your monthly payments smaller on a mortgage? (There is more than one correct answer.)
Have a larger down payment.
Have a smaller down payment.
Choose a shorter term length.
Choose a longer term length.
Make additional payments towards the principal.
A credit card is an example of revolving credit.
Choosing a shorter term on your loan will
reduce your monthly payments and reduce the total interest you owe.
reduce your monthly payments and increase the total interest you owe.
increase your monthly payments and increase the total interest you owe.
increase your monthly payments and decrease the total interest you owe.
Which of the following is TRUE about installment loans? (There is more than one correct answer.)
The loan amount changes based on your use each month.
Interest is calculated into the monthly payments.
You only pay interest if you don't pay the full balance by the due date.
There may be penalties for late or missed payments.
A higher credit score may mean lower interest rates.
Potential landlords may check your credit history before renting to you.
Which of these might happen if you don't make your mortgage payments? (There is more than one correct answer.)
After one missed payment, you might lose your home.
You will be charged late fees.
Your credit score will go down.
Foreclosure process will begin after 30 days of missed payment.
Which of these is TRUE about credit cards and debit cards?
They are both linked to a checking account in different ways.
Some debit cards say VISA on them; credit cards don't.
With a credit card, you are using money that you already have.
A credit card can offer rewards and purchase protection.
Having a small amount of debt is good for your credit history.
Which of these is TRUE about revolving credit? (There is more than one correct answer.)
You only pay interest if you don't pay your full balance by the due date.
Interest is calculated into the monthly payments every time.
Having a high credit score may mean lower interest rates.
The balance is based on how much of the credit limit you use each month.
When are you able to access your free credit report?
There is unlimited access.
If you are denied credit.
Once a year from each of the three credit reporting agencies.
Never.
No one may access your credit report without your permission.
Capacity refers to
the ability of the borrower to pay back the loan
the trustworthiness of the borrower
the assets of the borrower
Which of these characteristics of a borrower is part of capacity? (There is more than one correct answer.)
Credit Score
Number of dependents
Debt to Income ratio
A vehicle or jewelry
Which of the following statements is TRUE:
Applying for several lines of credit in a short period of time can help boost a person’s credit score.
Paying off a credit card balance in full can have a negative impact on someone’s credit score.
The longer you use credit responsibly, the higher your credit score.
Low risk borrowers tend to have low credit scores.
What is the FICO credit score cutoff point where lenders view you as an acceptable risk versus a subprime risk?
300-579
580-669
670-739
740 and above
Which of these is found on your credit report? (There is more than one correct answer.)
Your legal names
Your spouse's credit history
Your credit score
Your current and past employers
A record of late payments on credit accounts
