Credit Test review

Which of the following is considered to be open-end credit?

• Department store charge card (Credit Card)
• A mortgage

To qualify for a Federal Housing Administration (FHA) loan, a person must generally

• have one-quarter of the cost of the home for a down-payment
• fulfill income guidelines

Which number is the better Credit Score?

• 350
• 750

When a person declares bankruptcy that fact will appear on the person's credit report

• for a 10 year period.
• for a 3 year period.

A credit card finance charge is:

• the sales tax
• the dollar amount it costs to use credit

A creditor may deny credit because of:

• bad credit history
• age
• race

A person has three credit cards with very large outstanding balances and is unable to make payments on any of them. Which action should the person take?

• Notify the credit card companies in order to negotiate a new payment plan.
• File for bankruptcy in order to maintain one's current credit score.

Barbara and Paul all charged $1,000 on their credit cards last year. Who paid the most in finance charges?

• Paul, who only pays the minimum amount each month.
• Barbara, who always pays off her credit card bill in full after she receives it.

What is a credit score?

• A reward system that is based on the number of credit cards a person has.
• A number used to determine how much credit to extend to a person.

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

• Length of credit history and new credit inquiries
• Payment history and total debt