WorksheetsEverfi build 1-4
Total questions: 37
Worksheet time: 26mins
Match the following
The payment you must pay for a credit card each year
Annual Fee
The amount of interest you pay on balances you carry over from month to month on a credit card
Annual Percentage Rate (APR)
A person the primary cardholder gave permission to use their credit card
Authorized user
How responsible you are about repaying debts
Character
Property or financial that could be offered as insurance incise you do not repay your loan
Collateral
Match the following
Someone who legally promises to pay back your loan if you do not.
Cosigner
A measure of financial wellness that is created by buying something now and paying for it later.
Credit
An account with a card that lets you repay monthly the money that you spend.
Credit card
Stop any outside access to your lines of credit and credit report
Credit Freeze
When someone uses a minor’s personal information to open a line of credit like a credit card or loan
Child identity theft
Match the following
The maximum amount you can spend on a credit card before you have to start paying it back
Credit limit
A number that shows how much of your overall credit you’re using (called utilization)
Credit ratio
A detailed history of how you have borrowed money in the past, including how you handled paying back loans and credit cards
Credit report
Companies that maintain your credit history - Equifax, Experian, and Trans-Union
Credit reporting companies
A number determined by your credit history. It helps lenders determine how creditworthy you are
Credit score
Match the following
Loan companies determine this based on how deserving you are of credit.
Creditworthy
When you use this card you are spending your own money from you checking account
Debit card
These companies are hired to find those that have not paid back borrowed money and recover the unpaid amount
Debt collection agency
This government agency protects consumers from scammers and unfair business practices
Federal Trade Commission (FTC)
This is a notice that is posted on your credit report that alerts credit card companies that you may have been a victim of identity theft
Fraud alert
Match the following
The time between when you spend money using the credit card and when the company charges you interest
Grace period
The amount earned before taxes, benefits, and other payroll deductions are withheld from your paycheck
Gross wages
When a financial institution checks your credit to make a lending decision. Hard inquiries impact your credit score.
Hard inquiry
A set amount of money given to a person, then paid off over time, like a car or student loan
Installment accounts
The cost of borrowing money, usually, a percentage of the loan amount
Interest
Match the following
A fee that is charged when you pay your bill after the due date
Late payment fee
The payment on a credit card that is the lowest amount of money the cardholder can pay each billing cycle to keep the account's status current
Minimum payment
The amount earned after taxes, benefits, and other payroll deductions are withheld from your paycheck
Net wages
A record of your wages supplied by an employer
Paystub
The fraudulent practice of sending emails pretending to be from respectable companies to get people to reveal personal information, such as passwords and credit card numbers
Phishing
Match the following
Accounts that give a borrower a maximum amount of money and are open as long as the borrower is in good standing with the lender
Revolving accounts
A kind of credit card that requires you pay a cash security deposit, usually equal to the amount of credit the company is offering
Secured credit card
Credit checks by lenders and other financial institutions to provide preapproval for credit cards and loans. Hard inquiries impact your credit score. Soft inquiries do not impact your credit score.
Soft inquiry
A credit card offered to young people that has a lower credit limit but allows the person to build credit
Student credit card
What is the best definition of a credit report?
A number that shows a snapshot of your credit at a specific moment in time
A number that shows how much of your overall credit you're using
A period of time between when you spend money and when the company charges you interest
A history of how you pay back loans and credit cards
What is the best definition of a credit score?
A period of time between when you spend money and when the company charges you interest
A number that shows a snapshot of your credit at a specific moment in time
A number that shows how much of your overall credit you're using. A history of how you pay back loans and credit cards
Which items do credit card and lending companies use to determine whether to lend you money or not?
Your credit score
Your credit bulletin
Your credit discount
Your credit dispatch
Which is the best way to lower credit utilization to an acceptable level?
Increase your credit card balance
Apply for more credit cards
Decrease your credit card balance
Close credit cards
Which credit utilization rate would be preferable to a lender on a credit card application?
27.5%
43.0%
76.3%
. 83.0%
What is a good strategy if you want to improve your credit score?
Increase your account balance
Pay your credit card bills late once in a while
. Overdrawing your bank balance
Minimize new applications for credit
What habit lowers your credit score?
Pay your bills late
Decrease your credit card balance
Schedule automatic bill payment
Check your credit report
Which entries on a credit report will decrease your credit score?
Bill paid on time
Soft inquiries
Late payments
Current address
Why does higher credit utilization decrease your credit score?
Because lenders feel that you are unreliable
Because lenders are unsure of your ability to handle your account
Because lenders think you are able to take on more debt
. Because lenders feel that you can't handle more debt
What kind of credit inquiry has no effect on your credit score?
A. A soft inquiry has no effect on your credit score
Both hard and soft inquiries have an effect on your credit score
. A hard inquiry has no effect on your credit score
. Neither hard nor soft credit inquiries have an effect on your credit score
Which of these criteria make a person a good cosigner?
They rent an apartment
They have a steady job
They have many debts
They pay their bills late
How do lenders evaluate if a borrower or cosigner will pay them back?
Cadence, collateral, calendar
Callousness, capacity, , character
Capacity, criticism, character
Capacity, collateral, character
What is the correct definition of capacity for potential cosigners?
The cosigner's credit history
. The cosigner's financial assets, such as a house or car
The cosigner's past record of paying on time
The cosigner's current financial situation
What is the correct definition of collateral for potential cosigners?
The cosigner's credit history
The cosigner's financial assets, such as a house or car
The cosigner's past record of paying on time
The cosigner's current financial situation
What is the correct definition of character for potential cosigners?
The cosigner's current bank balance
The cosigner's financial assets, such as a house or ca
The cosigner's past record of paying on time
The cosigner's current financial situation
What is the correct definition of a cosigner for a loan?
Someone who will pay a loan for a borrower
Someone who will promise to pay a loan if the borrower doesn't.
Someone who will pay the electric bills for a borrower
Someone who signs the loan documents
Why would a borrower get a cosigner for a loan?
They can't qualify for a loan by themselves
They need help evaluating the loan terms
. The borrower can handle the entire loan themselves
They want to open a savings account
Chris wants to get a cosigner for a car loan. Which person would be the best choice?
A person with bad credit but a steady job.
A person with no assets (car, house, or financial account)
A person with a good credit history and a car and house
A person with some late payments on their credit card
Chris asks Sarah to cosign, but she says that she doesn't have a good credit history. Which of the following make her unable to cosign for Chris?
She has very little debt which affects her capacity
She has made late payments which affects her character
She has a good character since she pays all credit card bills in full
She owns her condo which affects her collateral
Why would a person refuse to cosign for a loan?
They want to help the person applying for a loan but would rather just pay for it for them
They are not prepared to take on another financial obligation
They can make payments if the borrower doesn't
They trust the person who's applying for the loan
Which action is best if you suspect you're the victim of identity theft?
Check your credit reporChange your email address
. Get a PO box
Change your phone number
How can you spot identity theft by looking at the personal section of your credit report?
. If you see hard inquiries
If you see credit lines that you have opened
If you see an address that isn't yours
If you see your accounts
What does an account you don't recognize on your credit report mean?
You're not the victim of identity fraud
You may be the victim of identity fraud
Your credit report is valid
Your credit report is inoperative
You don't have any credit, but when you check with a credit bureau, they have a credit report for you. What can you conclude?
You are not the victim of identity theft
The credit bureau made a clerical error
There is nothing to worry about
You could be the victim of identity theft
What is the definition of freezing your credit?
No one can open a credit card in your name
. No one can use your credit cards to make a purchase
You can only use your credit cards if you notify one of the credit reporting agencies
The credit reporting company will call to check when someone tries to open a new account
Why is placing a fraud alert an effective way of dealing with inaccuracies in a credit report?
No one can share your credit report with a credit card or lending company
. No one can use your credit cards to make a purchase
You can only use your credit cards if you notify one of the credit reporting agencies
. You will be contacted when someone tries to open a new account in your name
What's the difference between a freeze and an alert?
With a credit freeze, you can apply for new credit but you can't use your credit cards, while with a fraud alert, you can.
With a credit freeze, you can apply for new credit, while with a fraud alert, you can't
With a credit freeze, you can't apply for credit, and it's the same for a fraud alert
With a credit freeze, you can't apply for any new credit, while with a fraud alert, you can
If you fear you've been the victim of identity fraud, who do you contact to freeze your credit?
The Federal Communications Commission (FCC)
. A private detective
The credit reporting agencies - Experian, TransUnion, and Equifax
Credit card companies where you might open an account
Imagine you're reviewing your credit report and notice something odd. What could be a sign that someone else has been using your identity?
Your address is listed correctly
You see accounts listed that you don't remember opening
All the accounts on the report were opened by you
Your credit history begins with your first loan or credit account
Michael noticed an inaccuracy in his credit report and he is interested in applying for a new credit card next month. Which action should he take?
He should ask all three credit bureaus to freeze his credit
He should ask one of the credit bureaus to issue a fraud alert
He should call the police
He should create a fraud report at the FTC
