Credit Module Test

The interest or money charged a borrower for the use of credit is called

Finance Charge

Finance companies take less risk and charge lower interest rates that credit unions do

False

The amount borrowed is known as the

Principle

A credit line is a pre-established amount that can be borrowed from on demand

True

The most common source for a cash loan is a

Private Lender (family or friend)

A revolving credit account is a type of open-ended credit

True

An all-purpose credit card, such s Visa, Mastercard, or Dicover is an example of what type

Revolving Credit

Drug stores, clothing stores, etc, are examples of retail stores that take Visa and mastercard

True

Which of the following is not an advantage of using credit

It allows you to overspend

Large retailers usually only let customers use their store charge cards an bank debit cards only

False

Property you own that is worth more that your debts is called

Capital

Banks are more willing to give loans or credit to their regular customers

True

A loan for which the borrower pledges property to ensure repayment is an

secured loan

Credit unions make loans and credit available for members and non-members

False

Credit that can be used again and again, as long as you don’t exceed the limit

is called open ended

The annual percentage rate is the cost of credit, expressed as a yearly percentage

True

Generally speaking, the lowest interest rate for a loan would be found at a

Credit Union

All credit cards have the same conditions and terms, so it doesnt matter which one you choose

False

In case of an error on a bill from a business where you used your credit card, which of the following is true

You should contact the company explaining the problem

Your credit history reveals your ability to pay debt based on past experience

True

Is it illegal to discriminate on the basis of which of the followng is granting or denying credit

marital status

Credit bureaus gather stores, ans sell credit info to other businesses

True

Under the Consumer Credit Protection Act, if you report your credit card lost or stolen, your liability is limited to

$50

The 3 main credit bureaus in America are Experian, Equifax, and Creditfax

False

Which of the following info items is off-limits to credit bureaus

Medical records

Credit bureaus use info from private records, such as income tax records and social security records

False

Paying your bills on the due date or a day or two late will earn you what type if credit rating

Good

Credit scores are created by a point system that give you score somewhere between 300 and 850

True

The 3 main credit bureaus in America are Experian, Equifax, and:

Transunion

An excellent credit rating means you pay your bills early and pay more the minimum amount

True

Couples who are married the wives credit score only show up and are reported under the husbands name

False

Credit files updated daily by computers and search procedures through the credit bureaus

True

Lawful uses of your credit report include applying for credit, renting an apartment, and insurance matters

True

You may see your credit report at no  charge within 60 days of credit denial

False

The state of the economy has little effect on your ability to repay a debt

False