WorksheetsUnderstanding Credit Types and Terms
Total questions: 15
Worksheet time: 10mins
Characteristic of closed-end credit:
Revolving balance
Equal payments are required
Credit limit varies
Interest rates vary
What is one characteristic of open-end credit?
A down payment must be made before receiving the loan
Allowed to borrow unlimited money as long as you pay it back
Credit is extended in advance so the borrower does not have to apply for credit each time
Equal payments required
If a credit card is used properly, what benefits does it have for the cardholder?
Pay higher interest rates on other forms of credit
Positive credit history
negative credit history
no benefits
What is penalty APR?
Interest rate charged if the penalty terms are triggered
Interest rate during introductory period
Interest rate charged on your account
Interest rate that may change during time
What is a balance transfer?
Transferring money from one account to another, usually to get a better interest rate
Withdrawing cash from an ATM using a credit card
Transferring money from your debit card to your credit card
Paying a credit card balance with a check
When may a person view his/her credit report for free?
At any time and an unlimited number of times
Three times per week, from each of the three main credit reporting agencies
A person may not review his/her credit report
If a person has sufficient financial resources
If you co-sign for credit, what can happen?
It can only improve your credit report
It can only harm your credit report
It will not affect your credit at all
It can improve or harm based on how the credit is used
When internet scam artists use either pop-up messages or emails to lure consumers into giving personal information this is called:
Dumpster Diving
Phishing
Scamming
Spamming
The "S" in HTTPS stands for what?
Secure
Safe
Solid
All of Above
A Refund Anticipation Loan is where you give the lender title to your property in exchange for money, and they get to keep the property or item if you do not pay them back.
True
False
Which type of credit allows for money to be received prior to getting their paycheck, however can result in extremely high fees:
Rent to Own
Title and Pawn
Refund Anticipation
Payday Loan
Which of the following is NOT included when calculating an individual's credit score?
Consumer's Payment History
Pursuit of new credit
Consumer's Salary
Outstanding Debt
If a credit card is stolen and used fraudulently, how much will you be liable for?
$25
$50
$100
What is credit?
Money allocated to a specific account for future use by the consumer without borrowing
Goods, services, or money received in exchange for a promise to pay a definite sum of money at a future date
The ability and willingness of an individual to pay back a loan as perceived by the lender
An individual’s character, capital, capacity, collateral, and conditions
Explain two ways a person can protect themselves from identity theft.
