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Credit Review Flashcards | StudBud
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Credit Review
Credit Review
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StudBud Administration
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5,121 plays
This is a review for a Credit test.
Flashcards
57 cards
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Practice quiz
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Questions
57
Answers
1
Which statement is true about Consumer Credit Counseling ?
All of these are true.
They can help manage your debt
Working with them will increase your credit score
They can help you get a loan
2
Ford offering credit to sell their Model T demonstrates the relationship of credit to the economy showing
No relationship
Credit weakens the economy
Without credit there is no economy
Credit strengthens the economy
3
How many credit bureaus or credit reporting agencies are there?
3
4
2
5
4
Credit cards should be paid in full every month to avoid
Interest charges
Negative credit report
Account Closure
Late fees
5
When a loan is higher than the value of the collateral, it is called:
Secured
Upside Down
6
Credit is a _______ that must be managed/used wisely.
negative
tool
positive
necessity
7
Closing an account you no longer use negatively affects your credit score because:
It reduces your amount and length of credit
It reduces your credit utilization ratio
It reduces your credit worthiness
It reduces your length of credit history
8
One significant reason to avoid payday lenders, title lenders and pawn shops is:
They have to do a credit check and your credit is probably bad
Predatory interest rates
You could lose your stuff
Very high fees
9
Creditors use collection agencies to
Approve credit
All of these
Harass customers
Collect unpaid debts
10
Utility, cell phone, internet and gym membership bills are examples of what kind of credit?
Revolving Credit
Service Credit
Installment Credit
11
Paying only the minimum payment results in
An increase in your credit score
More interest paid
paying for a longer period of time
Paying more interest for a longer period of time
12
How does using credit cards instead of cash change spending behavior?
No change in spending behavior
Spending does not matter as long as you pay off the balance
People spend less with credit cards
People spend more with credit cards
13
Identity thieves can do all of these with your personal information but
Get medical care or use your name if arrested
Open Credit accounts
Rent an apartment
They can do all of these
14
This should be the last resort option if you continue to struggle paying your bills on time?
File Bankruptcy
Contact your creditors
Get a loan
Sign up with Consumer Credit Counseling
15
Which indicates your potential to repay debt?
Credit Card Balance
Credit Score
Salary
Checking Account Balance
16
Cost of borrowing money on an annual basis
Annual Fee
Annual Percentage Rate (APR)
17
Which factor will increase your credit?
Prompt payments
All of the above
High credit availability to credit usage(Credit utilization)
Lengthy credit history
18
Which statement is not true about a secured credit card?
Cards are secured by a savings account
Wise use will help build a credit score like unsecured cards
No payments are made since it is secured by savings account
It looks no different than an unsecured card
19
Benefits of paying extra on a loan:
Shorter time of paying
All of these
Less Interest
Improve credit score
20
With this kind of identity theft, a person could find they are facing legal problems for crimes they did not commit.
Synthetic
Financial
Criminal
Medical
21
A paycheck garnishment is
A court order allowing lender to take part of paycheck
Where bank sells the property of one who is behind on pmts
A procedure for dealing with debt problems
Process of taking something back for failure to make payment
22
Credit cards are generally________ credit
Secured
Unsecured
23
Which of the following will not impact your FICO score?
Paying cash for all purchases
Getting a personal loan from a bank
Getting a mortgage
Using credit cards
24
Which bankruptcy affects credit for 10 yrs?
Chapter 7
Chapter 13
25
What kind of identity theft combines real and fake information to create an identity?
Criminal
Medical
Financial
Synthetic
26
With Snowball Method - which is paid first?
The largest debt
Whichever is most past due
The debt with the highest interest
The smallest debt
27
Bankruptcy reserved for individuals with few assets, erases almost all debts and stay on your credit report for 10 years
Chapter 13
Chapter 7
28
Time frame that a loan agreement is in force
loan financing
loan term
29
You are borrowing money when using this kind of card:
Debit Card
ATM Card
Credit Card
30
How often can you receive a free credit report?
Annually and when denied credit/victim of fraud
If on public assistance or unemployed
If you have a fraud alert on your file
All of these
31
Device that can obtain your credit card information through your wallet or purse is called:
RFID or Near RFID Reader/Skimmer
Scanner
Skimmer
Spimmer
32
Consequences from poor debt management can include:
Lawsuit or wage garnishment
Seizure of collateral or other assets
Decrease in credit score
All of these
33
Website to go to if you are a victim of identity theft to get help
identitytheft.gov
fbi.gov
Identitytheft.com
your local police
34
Credit scores tend to go down as people get older
False
True
35
Collateral is an item used to secure a loan.
False
True
36
Multiple "hard inquiries" will cause your credit score to decline.
False
True
37
Your credit score can affect more than your ability to get credit.
False
TRUE
38
Device that can steal your credit card information when you swipe it is called:
RFID or Near RFID Reader/Skimmer
Scanner
Skimmer
Spimmer
39
With Snowball Method- which gets the extra payment per month first?
The smallest debt
The money is split evenly between bills
The largest debt
The debt with the highest interest
40
With this form of bankruptcy, some debt is repaid, some assets kept & stays on credit for 7 yrs
Chapter 13
Chapter 7
41
Credit cards that allow you to carry a balance are examples of what kind of credit?
Installment Credit
Service Credit
Revolving Credit
42
Credit scores range from
0-800
350-800
100-1000
300-850
43
Theoretically, using a debit card, you cannot
Go into debt
Purchase an airline ticket
Purchase something online
Rent a car
44
Most lenders will charge a late fee if you are even one day late on your payment.
True
False
45
A decrease in value of an item
depreciation
inflation
46
When social security numbers are not used as often, identity theft is easier.
False
True
47
First thing to do when noticing unauthorized charges
Call the bank or credit card issuer
Call the police
Make a report to the credit bureaus
Call the merchants
48
What is the worst thing to do if you continue to struggle paying your bills on time?
Ignore it
Get a lawyer
Sign up with Consumer Credit Counseling
Contact your creditors
49
Which of the following is NOT recommended in the debt snowball method?
Every extra dollar should go to the largest debt
Attack your debt with intensity
List debts from smallest to largest &pay the smallest first
When 1 debt is paid, add min + extra payment to next debt.
50
A car loan or a mortgage are examples of what kind of credit?
Service Credit
Installment Credit
Revolving Credit
51
Hard Inquiries are
None of these
getting a loan
credit checks for credit applications
getting issued a credit card
52
Credit repair or bankruptcy relief companies should be used to get out of debt or fix your credit,
True
False
53
Identity theft has
Decreased over time
Stayed about the same
Increased over time
54
Bankruptcy can negatively affect your score for how long?
1 - 5 years
7-10 years
10-15 years
6 months to 1 year
55
Which factor will lower your credit score?
Hard Inquiries and late payments
All of These
Closing a Credit Card Account
Little or no Credit History
56
With snowball method, once the the 1st debt is paid, how much will be applied to the next debt?
The min payment of the first and current payment plus the extra payment
Whatever you can afford
The extra payment
Its hard to tell
57
What is the first thing to do if you cannot pay your bills on time?
Get a lawyer
Contact your creditors
Get a loan
Sign up with Consumer Credit Counseling
