Jake’s credit application has been declined becauseof his negative credit history

Jake has applied for 4 credit cardsand a car loan

The financialcounselor that Ariel consulted about her use of credit recommended

Keep the total amount of $ she has borrowed <20% no house

Jenny is 18‐years‐old and has appliedfor credit for the first time.

a. Jenny should obtaina secured credit card.

Evan is writinga scholarship essayabout the importance of responsible money management

When you are borrowing, you are spending future income

Edward wants to develop a positive credithistory. How shouldhe do this?

maintain reasonableamounts of available credit

Leah is trying to explain the difference between open‐end and closed‐end credit

Equal payments are required on a regularbasis until repaid.

David earns $5000 per month at his accounting job

David’s credit is safe range for someone with his income

When Bryce attempted to borrow money at the bank

Interest rates on his loan will be higher

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Credit Reports/Scores & Basics 6.01 & 6.02

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Answers

1
Jake’s credit application has been declined becauseof his negative credit history
Jake has received3 traffic tickets
Jake pays his bills consistently and on time.
Jake has applied for 4 credit cardsand a car loan
Jake has 2 store c c, a bank c c, a car loan, and a mortgage
2
To answer the essay test question about the meaning of open‐end credit
Individual are allowedto borrow an unlimitedamount of money
Payments are equal and requiredto be paid on a regular basis
Credit is extended in advance
A down payment must be made before receiving a loan.
3
Which is NOT an example of a data furnisher?
Medical Provider
Utility Company
Landlord
Credit Card Company
4
The financialcounselor that Ariel consulted about her use of credit recommended
Keep the total amount of $ she has borrowed < 20% of her ni
Keep the total amount of $ she has borrowd <40% of her n
Keep the total amount of $ she has borrowed <20% no house
Keep the total amount of $ she has borrowd < 40% of her ni
5
Jenny is 18‐years‐old and has appliedfor credit for the first time.
Jenny should apply for a differenttype of credit.
Jenny should acquireseveral credit cards
Jenny should re‐apply but include a letter of recommendation
a. Jenny should obtaina secured credit card.
6
Evan is writinga scholarship essayabout the importance of responsible money management
Borrowing builds a strongcredit history
Borrowing strongly affectsthe present self
When you are borrowing, you are spending future income
Borrowing is an vital part of a responsible financial plan
7
When may a person view his/her credit report for free?
If a person have financial resources
Once a year from all three CRA
At any time and unlimited
You may NOT review your credit
8
Edward wants to develop a positive credithistory. How shouldhe do this?
maintain reasonableamounts of available credit
have one type of credit account
open credit accountsin their parents’ names
pay cash for the majorityof purchases
9
Leah is trying to explain the difference between open‐end and closed‐end credit
It is a continuous loan the borrower must repay
Credit limits vary depending on the loan balance
Equal payments are required on a regularbasis until repaid.
Interest rates vary depending on the repayment history
10
1. Becky no longer wants to use her Clothes‐R‐Us store credit card.
Keep the credit card in her wallet
File the credit card away
.Let a family member take over the account
Close the account by phone
11
David earns $5000 per month at his accounting job
David’s credit is safe range for someone with his income
David’s student loan must be subtracted from his car loan
David’s student loan is safe but his car loan is not
David’s total creditpayments are > the recommended amount
12
When Bryce attempted to borrow money at the bank
Purchase price of the item will be higher
Monthly loan payments will be lower
Interest rates on his loan will be higher
Interest rates on his loan will be lower
13
Which of the following is NOT included in an individual’s creditreport?
Account balances
Medical information
Current and past addresses
Bankruptcies and foreclosures

Credit Reports/Scores & Basics 6.01 & 6.02 Flashcards | StudBud