Personal Finance Courses: Credit

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1.
The higher your credit score is, the _______ the interest rates will be on loans you take out.
Choose wisely. There is only one correct answer.
Lower. If you have a high credit score, that tells lenders that you are a responsible borrower, and they will charge you a lower interest rate than if your credit score were low.
2.
When you are in the market for a credit card, one of the best ways to do comparison shopping is to make use of _______.
Choose wisely. There is only one correct answer.
The Internet. There are Websites that provide comparisons of different credit card programs, and many credit card providers use the Internet to make information about their programs easily available.
3.
It is more cost effective for you to buy something outright than pay for it with credit.
Choose wisely. There is only one correct answer.
True. You can avoid finance charges this way.
4.
An example of revolving credit is _______.
Choose wisely. There is only one correct answer.
A credit card agreement. Credit card agreements are an example of revolving credit.
5.
Paying the minimum monthly payment on your credit is affordable, but a major downside is that it takes much longer to pay off.
Choose wisely. There is only one correct answer.
True. The less you pay each month, the longer it takes to pay off. Plus, you pay a huge amount of interest.
6.
Which of the following is a good reason to have a credit card?
Choose wisely. There is only one correct answer.
A credit card can be valuable in case an emergency exceeds your available funds on hand. A credit card can be a lifesaver if you have to pay for emergency expenses that go beyond your savings.
7.
What collection efforts can a creditor that obtains a court judgment against you legally do?
Choose wisely. There is only one correct answer.
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.