Personal Finance Courses: Credit

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1.
What collection efforts can a creditor that obtains a court judgment against you legally do?
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The creditor can take steps to garnish your wages and seize assets, such as bank accounts. The creditor can also file a lien against any real estate you own.
2.
It is possible to use a credit card to earn more than you pay on it.
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True. You can earn rewards while paying your balance in full each month and avoiding fees.
3.
Paying the minimum monthly payment on your credit is affordable, but a major downside is that it takes much longer to pay off.
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True. The less you pay each month, the longer it takes to pay off. Plus, you pay a huge amount of interest.
4.
As a general rule, credit exists to enable you to buy things that _______.
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You cannot afford to buy right now. Credit exists to help you buy things you can't afford right now. While the other choices may or may not be true, they are not the reason credit exists in the first place.
5.
If you are wealthy and don't need to take out any loans, it is still a good idea to have good credit.
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True. You don't know for sure that you will still have your money in the future.
6.
It is more cost effective for you to buy something outright than pay for it with credit.
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True. You can avoid finance charges this way.
7.
Having no credit profile can result in you being denied credit.
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True. Creditors like to know that you have a history of using credit.