Personal Finance Courses: Credit

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1.
How long can a bankruptcy stay on your credit report?
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Seven or 10 years, depending on the type of bankruptcy. At present, they can stay this long.
2.
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.
3.
Credit is free money.
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False. Credit is a loan of money, meaning you must pay it back with interest after using it. It is not free money.
4.
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.
5.
A credit card's annual percentage rate is _______.
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The interest rate you must pay over the course of a year. The APR is what you would pay over a whole year. What you pay each month on your card is 1/12 of that.
6.
Which of the following actions are outside collection agencies legally allowed to take against you?
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None of the above. All these actions are illegal.
7.
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.