Which of these are long-term impacts of having a good credit history?

It's easier to pay for major purchases like cars, houses, and education

What is the definition of freezing your credit?

No one can open a credit card in your name

What is the correct definition for the grace period?

When you make a purchase using the credit card and the date when interest.

Micheal noticed an inaccuracy in his credit report, but wants to apply for a credit card. What should he do?

He should askone of the credit bureaus to issue a fraud alert

What is a way to tell by your credit report your are a victim of fraud?

There are accounts you don't recognize

What is the correct definition of character for potential cosigners?

The cosigner's past record of paying on time

What's the difference between a freeze and an alert?

With a credit freeze you can't apply for new credit, with an alert you can

Chris wants to get a cosigner, who would be the best choice?

A person with many assets and good credit history.

How do lenders evaluate if a borrower with a cosigner will pay them back?

Capacity, collateral, character

Why would a borrower get a cosigner for a loan?

They can't qualify for a loan by themselves

How can you spot indetity theft by looking at the personal section of your credit report?

If you see an address that isn't yours

Which action could help improve your credit history?

Always pay your credit bill on time

Chris asks Sarah, but she doesn't have a good credit history. Which option makes her unavailable to cosign?

She has made late payments whch affects her character & credit score.

What is the best definition of a credit score?

A number that shows a snapshot of your credit at a certain time

What is the correct definition of capacity for potential cosigners?

The cosigner's currect financial situation

What is a good strategy if you want to improve your credit score?

Minimize new applications for credit.

Which is the best strategy for paying your credit card bill?

Pay the entire balance every month

What does an account you don't recognize on your credit report mean?

You may be the victim of identity fraud.

Why is it important to find a credit card with a lower APR?

A lower APR means you pay less in iterest

What statement is correct about grace periods?

The time between making a purchase and when you're charged interest

Why does a higher credit utilization ratio decrease your credit score?

Lenders think you can't handle more debt

Why would a person refuse to cosign for a loan?

They are not prepared to take on another obligation.

You have no credit cards; when you check with a credit bureau, they have a credit report for you. What does this mean?

You could be the victim of indetity theft.

Which is the best way to lower credit utilization to an acceptable level?

Decrease your credit card balance

Which statement is correct about Annual Percentage Rate (APR)?

It is what you are charged for carrying balances from month to month.

If you fear you have been the victim of identity fraud, who do you call to freeze your credit? Pick the best 2 answers.

The credit reporting agencies, Credit card companies

Why is placing a fraud alert an effective way of dealing with inaccuracies in a credit report?

You will be called if someone tries to open an account in your name.

What is the BEST definition of a credit report?

A history of how you pay back loans and credit cards.

What is the correct definition of a cosigner for a loan?

Someone who will promise to pay if the borrower doesn't

studbud

Build: Credit Fundamentals

40 termsStudBud Administration14 plays

Imported from external platform

Flashcards40 cardsFPractice quizPHost liveL

Questions 40

Answers

1
Which of these are long-term impacts of having a good credit history?
It prevents you from spending money on things you want
It gives you freedom to shop around for the best deal on tech
It lets you buy the things you want like clothes or cellphones
It's easier to pay for major purchases like cars, houses, and education
2
What is the definition of freezing your credit?
You can only use a credit card if you notify an agency
No one can use your credit cards to make a purchase
No one can open a credit card in your name
A credit report company will call if someone uses your card
3
What is the correct definition for the grace period?
The amount of time you have to pay your secured deposit.
The amount of time you have to make late payments.
When you make a purchase using the credit card and the date when interest.
The amount you pay for your card each year.
4
Why do lending and credit card companies use a borrower's Social Security number when opening an account?
To protect against fraud.
To ensure borrowers are US citizens.
To withdraw taxes.
To assign an interest rate.
5
What habit lowers your credit score?
Decrease your balance
Check your credit report
Pay your bills late
Schedule automating payment
6
What is a reason to pay more than the minimum payment due on your credit statement each month?
You save money on interest
It hurts your creditworthiness
It takes more time to pay off a balance
Your credit utilization rate stays the same
7
Which entries on a credit report will decrease your credit score?
Late payment.
Current address.
Bill paid on time.
Soft inquiries.
8
Micheal noticed an inaccuracy in his credit report, but wants to apply for a credit card. What should he do?
He should askone of the credit bureaus to issue a fraud alert
He should create a fraud report
He should ask all three credit bureaus to freeze his credit
He should call the police
9
What is a way to tell by your credit report your are a victim of fraud?
Your address is correct
Your credit history starts when you opened your first credit account
There are accounts you don't recognize
You remeber opening every account
10
What is the correct definition of character for potential cosigners?
The cosigner's currect financial situation
The cosigner's credit history
The cosigner's past record of paying on time
The cosigner's finacial assets
11
What's the difference between a freeze and an alert?
With a credit freeze you can't apply for new credit
Neither will let you apply for credit
With a credit freeze you can apply for new credit
With a credit freeze you can't apply for new credit, with an alert you can
12
Chris wants to get a cosigner, who would be the best choice?
A person with late payments on their card.
A person with bad credit but a steady job.
A person with many assets and good credit history.
A person with no assets.
13
Which action is best if you suspect you're the victim of indetity theft?
Get a PO box
Chnage your phone number
Change your e-mail address
Check your credit report
14
How do lenders evaluate if a borrower with a cosigner will pay them back?
Callousness, capacity, character
Capacity, collateral, character
Cadence, collateral, calendar
Capacity, criticism, character
15
Why would a borrower get a cosigner for a loan?
They can't qualify for a loan by themselves
They want to open a savings account
The borrower can't handle it by themselves
They need help evaluating loan terms
16
Which credit utilization ratio would be preferable?
76.3
27.5
83.0
43.0
17
How can you spot indetity theft by looking at the personal section of your credit report?
If you see an address that isn't yours
If you see your accounts
If you see hard inquiries
If you see credit lines you have opened
18
Which action could help improve your credit history?
Always pay your credit bill on time
Make a major purchase that you can't afford right now
Leave credit card bills outstanding
Only get a debit card and avoid credit cards
19
Chris asks Sarah, but she doesn't have a good credit history. Which option makes her unavailable to cosign?
She has a good character.
She has very little debt which affects her capacity.
She owns her condo which affects her collateral.
She has made late payments whch affects her character & credit score.
20
What is the correct definition of collateral for potential cosigners?
The cosigner's credit history
The cosigner's finacial assets
The cosigner's currect financial situation
The cosigner's past record of paying on time
21
What is the best definition of a credit score?
A number that shows a snapshot of your credit at a certain time
A history of how you pay back loans and credit cards
A period of time between money spent and interest
A number of your overall credit
22
What is the correct definition of capacity for potential cosigners?
The cosigner's finacial assets
The cosigner's past record of paying on time
The cosigner's credit history
The cosigner's currect financial situation
23
What is a good strategy if you want to improve your credit score?
Overdrawing your balance.
Minimize new applications for credit.
Pay your bills late.
Increase your account balance.
24
Which is the best strategy for paying your credit card bill?
Paying the minimum every month
No monthly payments at all
Pay half the balance every month
Pay the entire balance every month
25
What does an account you don't recognize on your credit report mean?
Your credit report is invalid.
You may be the victim of identity fraud.
Your credit report is innactive.
You're not the victim of indetity fraud.
26
Why is it important to find a credit card with a lower APR?
A lower APR means you pay less in iterest
A lower APR gives you a better credit history
A lower APR impacts your grace period
A lower APR means you have more time to pay off your balance
27
What statement is correct about grace periods?
Every credit card has a grace period
A short grace period is better for the borrower
You are charged interest during the grace period
The time between making a purchase and when you're charged interest
28
What type of card impacts your cedit history?
Driver's license
Student credit card
State ID card
Debit card
29
Why does a higher credit utilization ratio decrease your credit score?
Lenders think you are able to take more debt
Lenders think you're unreliable
Lenders are unsure of your ability to handle an account
Lenders think you can't handle more debt
30
Why would a person refuse to cosign for a loan?
They trust the person who's applying.
They want to help the person.
They are not prepared to take on another obligation.
The bank/lendor says their credit history is perfect.
31
You have no credit cards; when you check with a credit bureau, they have a credit report for you. What does this mean?
The credit bureau made a clerical error.
You are not the victim of identity theft.
You could be the victim of indetity theft.
There is nothing to worry about.
32
Which is the best way to lower credit utilization to an acceptable level?
Decrease your credit card balance
Apply for more credit cards
Increase credit card balance
Close credit card
33
Which statement is correct about Annual Percentage Rate (APR)?
It has nothing to do with how much interest you pay.
It stands for Amoritized Percentage Rate.
It is better for the borrower if the rate is higher.
It is what you are charged for carrying balances from month to month.
34
Credit card and lending companies use what to determine whether to lend money or not?
Your credit dispatch.
Your credit score.
Your credit bulletin.
Your credit discount.
35
Which of the criteria make someone a good cosigner?
The rent an apartment
The have many debt
They have a steady job
They pay their bills late
36
If you fear you have been the victim of identity fraud, who do you call to freeze your credit? Pick the best 2 answers.
The credit reporting agencies
A private detective
The Federal Communications Commisions
Credit card companies
37
What kind of credit inquiry has no effect of your credit score?
A hard inquiry.
A soft inquiry.
Neither hard or soft inquiries.
Both hard and soft inquiries have an effect.
38
Why is placing a fraud alert an effective way of dealing with inaccuracies in a credit report?
No one can use your credit cards.
No one can share your credit report.
You will be called if someone tries to open an account in your name.
You can only use a credit card if you notify an agency.
39
What is the BEST definition of a credit report?
A number that shows your credit card history.
A period of time between money spent and interest.
A number that shows a snapshot of your credit over 5 years.
A history of how you pay back loans and credit cards.
40
What is the correct definition of a cosigner for a loan?
Someone who will pay the electric bills
Someone who will promise to pay if the borrower doesn't
Someone who will pay a loan for a borrower
Someone who signs loan documents

Build: Credit Fundamentals Flashcards | StudBud