The interest rate charged on loans on an annualized basis

You should get a credit card once you are 18 and

You can be responsible to make every payment on time and in full

Your FICO score affects

The cost and ability to get a loan.

What happens to a co-signer if a payment is missed?

Co-signer has credit damaged and can be responsible for loan

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Financial Literacy Basics

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Test your knowledge on fundamental concepts of personal finance and credit management

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Questions 14

Answers

1
Credit cards are considered
Installment credit
Revolving credit
m1
A detriment to your credit
2
What is a secured credit card?
Unlimited credit limit
High interest rates
Requires a deposit
No deposit needed
3
What happens if a bill is unpaid for 90 days?
It goes to collections
You get a refund
Your score improves
Nothing happens
4
How long does a collection stay on your report?
5 years
7 years
1 year
3 years
5
What is APR?
The percentage a credit card pays you on an annualized basis
Who makes the card
How exclusive the card is
The interest rate charged on loans on an annualized basis
6
Which would NOT be considered installment credit?
Credit Card Bill
Student Loan Payments
Mortgage Payments
Car Payments
7
What is collateral in a loan?
A loan type
A credit score
A type of credit
Property for loan security
8
You should get a credit card once you are 18 and
Nothing, credit cards are great
You can be responsible to make every payment on time and in full
When you get mailed credit card applications
9
Your FICO score affects
Job qualifications
Admission to college
The cost and ability to get a loan.
10
What is a secured loan?
High interest rate
No collateral needed
Instant approval
Collateral required
11
What is a finance charge?
Monthly payment amount
Total loan cost
Credit limit
Interest rate only
12
What does a grace period mean?
Time to pay off loan
Time to increase limit
Time to apply for credit
Time before interest charges
13
What happens to a co-signer if a payment is missed?
Co-signer just needs to remind debtor to pay bill
Co-signer has credit damaged and can be responsible for loan
It will be fine. Co-signing is just a formality
14
Which action helps build a positive credit history?
Only pay half
Pay bills on time
Pay bills late
Ignore due dates

Financial Literacy Basics Flashcards | StudBud