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1.
What is the main reason behind using a credit card to buy things that you already have cash for?
It helps build a good credit record. Having the money already on hand makes it easy to pay your bill, and in the future, you will benefit from the enhanced credit history.
2.
If you have a credit card that is secured by your savings account, what will happen if you fail to make payments on your credit card balance?
The lender will take money out of your savings account to pay the balance. This is how the lender protects itself.
3.
If you want to establish credit but haven't yet, potential lenders can make a judgment about your creditworthiness based on other factors.
True. Lenders can look at your history of paying bills, your employment history, and your housing history.
4.
Why is it advantageous to apply for your first credit card at your bank or credit union?
It already has a sense of your financial health. Because of this, it may be willing to offer you a credit card.
5.
Personal loans from banks or credit unions are _______.
Secured or unsecured. They may be either, depending on what you qualify for.