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Basics Beginner: Credit

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1.
When buying with credit, you must pay back the borrowed amount along with interest and possibly _______.
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Finance charges. Finance charges may also be levied.
2.
Which of the following is the largest determiner of your FICO score?
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Payment history. Your payment history carries more weight than any other measure.
3.
In the language of credit, capacity refers to _______.
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Your ability to pay your debts. To creditors, the term is a measure of your financial health.
4.
Your credit score is determined by using _______.
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A mathematical model. This mathematical model calculates your credit risk based on several factors.
5.
When getting a debt consolidation loan, you can reduce your interest rates by _______.
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Putting up collateral. Putting up collateral reduces the risk that your creditor takes on, thus qualifying you for a lower interest rate.
6.
A creditor is a person who borrows money.
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False. A creditor is a person who lends money; a debtor borrows money.
7.
Under the Fair Credit Reporting Act, you can be exempted from direct mail solicitations that are based on lists obtained from credit bureaus.
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True. You have the right to not be included in them.