WorksheetsTake Charge: Unit 6
Total questions: 50
Worksheet time: 25mins
Cost of credit expressed monthly in dollars and cents:
Finance Charge
APR
Interest
Principal
The time in which you have to pay off your credit card without paying interest:
Finance Charge
Grace Period
Collateral
Interest
Cost of credit expressed as a yearly percentage:
Finance Charge
APR
Credit Score
Interest
Something of value used to secure a loan:
Mortgage
APR
Collateral
Principal
A person who agrees to pay a loan if the borrower fails to do so:
Cosigner
Collateral
Creditor
Debtor
Installment debt owed on houses, buildings, or land
Mortgage
Unsecured Loan
Collateral
Principal
A flat, yearly charge for owning a credit card
Finance Charge
APR
Annual Fee
Interest
Amount of money borrowed, before interest
APR
Annual Fee
Interest
Principal
Action that allows a creditor to take part of your wages if you miss a payment
Finance Charge
Collateral
Garnishment
Repossession
A good that does not quickly wear out or is used up
Garnishment
Durable Good
Repossession
Principal
The amount you pay to use someone else's money
Finance Charge
APR
Interest
Principal
A number that reflects the information in your credit report
APR
Grace Period
Credit Score
Principal
The legal right for the creditor to take back the collateral
Garnishment
Durable Good
Repossession
Principal
What do you have to pay when you borrow money
Principal + Collateral
Principal + Interest
The amount you borrowed
Twice the amount of the loan
To determine which creditor is charging the most for credit, a consumer should compare
Finance charges
Annual percentage rates (APR)
Monthly payments
Length of the credit agreements
It is recommended that you should check your credit history
Every day
Every month
At least once a year
Never
Credit cards resemble what type of charge account
An open charge
A budget charge
Revolving charge
None of the Above
Your credit rating affects your ability to
Obtain new financing, such as credit card accounts, lines of credit and loans
Be hired
Rent property
All of the above
You are considered a "poor" credit risk if your credit score is
Below 1000
Below 750
Below 649
Less than Zero
Which of the following is NOT an advantage of using credit
Being able to purchase an item on sale even though you do not have the cash
The opportunity cost of paying interest on interest
Being able to replace your broken garage door opener immediately
Keeping track of how much you spent on your vacation
Any time you receive credit, you are:
Going into debt
Earning interest on borrowed money
Lowering the cost of an item
Increasing the value of an item
Which of the following factors might affect a person's capacity to pay back a loan?
Other large debts
Involvement in community organizations
How often they have applied for credit
Problems with the law
To build good credit, you should:
Change job frequently
Never use credit
Use credit cards for everything you purchase
Make payments promptly as agreed.
What federal law governs how debt collectors interact with debtors regarding unpaid bills?
The Fair Credit Reporting Act
The Fair Debt Collection Practices Act
Truth and Lending Disclosure Act
Equal Credit Opportunity Act
What federal law requires that all cost of borrowing be made known to the consumer?
The Fair Credit Reporting Act
The Fair Debt Collection Practices Act
Truth and Lending Disclosure Act
Equal Credit Opportunity Act
What federal law gives you the right to know what is in your credit file?
The Fair Credit Reporting Act
The Fair Debt Collection Practices Act
Truth and Lending Disclosure Act
Equal Credit Opportunity Act
What is a mortgage?
A type of rent used to pay for housing
A type of loan used to buy a home, building, or land
A measure of the value of a home
A measure of your credit rating
What is the job of a credit bureau?
To distribute credit card offers
To report changes in interest rates to consumers
To keep track of and report on consumers' credit transactions and payments habits.
To enforce credit laws set forth by the U.S government
Which of the following is NOT one of the three major credit bureaus?
Experian
Credit Reportor
Trans Union
Equifax
Which of the following is NOT one of the three C's of Credit?
Capital
Capacity
Character
All of the above are included
What is the LAST RESORT you should choose to handle credit payment problems?
Speak with a credit counselor
File for bankruptcy
Get a second job
Transfer your balance to a different credit card
Credit Scores range from:
0 to 1000
250 to 800
300 to 850
0 to 850
A record of transactions involving the use of credit.
Credit history
Credit Score
Lender
Inquiry
A mathematical tool created to help a lender evaluate the risk associated with lending customers money.
Credit history
Credit Score
Lender
Inquiry
This occurs when permission is given to a company to check an individual's credit.
Credit history
Credit Score
Lender
Inquiry
The person or organization who has the resources to provide the individual with a loan.
Credit history
Credit Score
Lender
Inquiry
The law that requires prompt correction of billing errors after they have been reported to a creditor is the Fair Credit Billing Act.
True
False
Credit card applicants will always be accepted for the card they apply for, but they may have to pay a higher interest rate.
True
False
People under the age of 21 can never receive a credit card.
True
False
It is better to use a debit card rather than a credit card when purchasing items online.
True
False
You may get two free credit reports annually from each of the three credit reporting agencies.
True
False
Numerous credit applications in a short period of time may hurt your credit report.
True
False
This is charged when a cardholder does not make the minimum monthly payment by the due date.
Over-the-limit fee
Variable rate fee
Late payment fee
Balance transfer fee
Your credit rating affects your ability to
Obtain a loan
save money
Play a sport
get an education
The maximum amount of goods and services a person can buy on the promise to pay in the future is the
Finance charge
credit limit
Annual percentage rate
debit card
What is a benefit of using credit?
Paying lower prices for expensive durable goods
Establishing a credit rating
Not going into debt to buy things you want
Paying interest on borrowed funds
To avoid credit card fraud, an individual should
Avoid giving credit card numbers out over the phone unless you initiate the call
Avoid giving out your birth date
Avoid giving out your social security number
All of the above
A consumer can avoid paying interest on a credit card by
Negotiating the lowest APR
Having a parent co-sign on your credit card
Paying the minimum payment on time
Paying full balance on time
Of the following, which would not appear on a Credit Report
Criminal Background
Personal Information
Public Records
Inquiry Information
What factor is the most important when factoring your FICO score
Payment history
Number of credit inquiries
Total debt
Income
