Financial Literacy Study Set on CREDIT

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What are the two most important factors in calculating your credit score?

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Payment history and total debt

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Haidyn realized she has taken out too much debt and it has started to negatively impact her ability to budget. She has decided to pay off this debt in full as soon as possible. All of the following would be beneficial strategies EXCEPT…

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Applying for another credit card to use in case she runs out of cash paying off her debt

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Which of the following statements about credit scores does this bar graph support?
Credit scores tend to drop as you grow older because you are more likely to miss a payment at some point
It is more difficult for young people to borrow because they have less payment history for a lender to rely upon
When young people borrow, they are likely to have lower interest rates because their credit scores are lower
It is easier for young people to get loans at lower interest rates because they are likely to have never been late with a payment

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It is more difficult for young people to borrow because they have less payment history for a lender to rely upon

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All of the following would show up on a credit report EXCEPT... Salary of your current job, Payment history of your car loan, Credit card payment history, Student loan activity, Other:

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Salary of your current job

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Which of the following methods of getting your credit score would involve paying a fee? Mark only one oval.
Checking your credit card or loan statement,
Talking to a non-profit counselor,
Checking creditkarma.com,
Getting a score from myFICO.com

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Getting a score from myFICO.com

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Your friend confides in you that he has a low credit score. What is the single best way for him to improve his score?

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Make on-time payments

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Marc is 19 years old and wants to begin establishing a credit history. Which action should he take to meet that goal? Options: Always say "credit" when asked "credit or debit?" at a store, Ask his parents to cosign a credit card or add him as an authorized user on their credit card, Any time he borrows money from a friend or family member, be sure to pay it back promptly, Take out some private student loans, even though he doesn't need them because he has grants and scholarships

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Ask his parents to cosign a credit card or add him as an authorized user on their credit card

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Which of the following individuals or groups would be the LEAST likely to look at your credit score? Someone interviewing you for a job, Credit card companies, An insurance company reviewing your applicant for auto insurance, A bank representative who is helping you open a savings account

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A bank representative who is helping you open a savings account

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Frank and Jasmere are each shopping for a new car for themselves. Each will need a $20,000 loan that they will pay back over a five year period. Frank has a credit score of 730 and Jasmere has a score of 600. Which of the following statements is TRUE? Over the five year period, Jasmere and Frank will pay the same amount for the car loan, Frank's monthly payment on the auto loan will be about $100 more than Jasmere's payment, Jasmere's monthly payment on the loan will be about $100 more than Frank's payment, Lenders are not allowed to charge people different interest rates based on their credit scores.

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Jasmere's monthly payment on the loan will be about $100 more than Frank's payment.

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You have a credit card that you use regularly for small purchases with the goal of improving your credit score. Which strategy would have the GREATEST positive impact? Options: Use less than 30% of the credit limit and pay it off in full every month by the due date, Always carry a balance from month to month, Regardless of how much your balance is, make the minimum payment required on your credit card every month by the due date, Put the credit card in a drawer instead and don't ever use it

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Use less than 30% of the credit limit and pay it off in full every month by the due date