Managing Credit - #3A

What is a FICO score?

• A credit rating used only for mortgage applications

• A numerical representation of creditworthiness used by lenders

• A score that only measures credit card debt

• A rating system for bank accounts

The Fair Credit Reporting Act primarily serves to:

• Regulate interest rates on credit cards

• Protect consumers' credit information accuracy

• Set minimum credit score requirements

• Determine loan approval criteria

A "thin line" in credit terms refers to:

• A limited credit history

• A low credit limit

• A negative credit report

• A type of credit freeze

What is a "hard inquiry" on your credit report?

• A routine check of your own credit

• A monthly credit score update

• A credit check when applying for new credit

• A verification of employment history

The Equal Credit Opportunity Act prohibits discrimination based on:

• Credit score and income

• Employment history

• Race, religion, and national origin

• Previous bankruptcy only

What constitutes "good debt"?

• Credit card balances for luxury items

• High-interest personal loans

• Student loans for education

• Payday loans

A "soft inquiry" occurs when:

• A lender checks your credit for pre-approval

• You apply for a mortgage

• You request a credit limit increase

• A potential employer runs a background check

The Dodd-Frank Act was established to:

• Regulate credit card fees

• Protect consumers from predatory lending

• Set minimum credit scores

• Manage student loan debt

What factor typically has the highest impact on your credit score?

• Length of credit history

• Payment history

• Credit mix

• New credit applications

A tax lien affects your credit by:

• Improving your credit score

• Having no impact on your score

• Temporarily freezing your credit

• Severely damaging your credit rating