Credit Reports and Scores

What is the primary purpose of credit reports?

• To assess an individual's income and employment history
• To evaluate an individual's creditworthiness
• To determine an individual's eligibility for government assistance
• To track an individual's spending habits

How do lenders use credit reports?

• To determine an individual's income level
• To assess an individual's credit limits
• To evaluate the risk associated with extending credit or loans
• To track an individual's monthly expenses

What role do credit reports play in loan approvals?

• They determine the amount of money a borrower can receive
• They help lenders decide whether to approve a loan application
• They establish the borrower's income and employment history
• They calculate the interest rates for loans

How can credit reports impact interest rates and loan terms?

• They have no influence on interest rates and loan terms
• They determine the length of the loan repayment period
• They establish the amount of the down payment required
• They can lead to lower interest rates and more favorable loan terms

Why might employers and landlords request access to credit reports?

• To assess an individual's trustworthiness and financial responsibility
• To determine an individual's work experience and qualifications
• To evaluate an individual's criminal history
• To verify an individual's address and contact information

What is one benefit of regularly monitoring credit reports?

• It helps individuals increase their income level
• It enables individuals to track their daily expenses
• It allows for early detection of identity theft or fraud
• It determines an individual's credit score

How are credit scores related to credit reports?

• Credit scores summarize an individual's creditworthiness
• Credit scores provide details of an individual's borrowing and repayment activities
• Credit scores determine the interest rates for loans
• Credit scores are used to calculate loan limits

What is a credit score?

• The amount of money an individual owes on their credit cards
• A numerical representation of an individual's creditworthiness
• The total income of an individual
• The length of an individual's credit history

Which factors generally impact credit scores?

• Employment history and income level
• Credit card limits and available credit
• Credit utilization, payment history, credit history length, new credit applications, and public records/negative information
• Social media activity and online shopping habits

How does payment history affect credit scores?

• Timely payments positively impact credit scores while late payments have no effect.
• Late payments and delinquencies have a positive impact on credit scores.
• Timely payments positively impact credit scores while late payments have a negative impact.
• Late payments and delinquencies have no effect on credit scores.