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Basics Beginner:
Establishing Credit for the First Time
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Choose wisely. There is only one correct answer to each question.
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1.
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?
Choose wisely. There is only one correct answer.
Nothing will happen
The lender will take money out of your savings account to pay the balance
The lender will raise your credit limit, allowing you to charge more on it
The lender will take money out of your savings account to pay the balance. This is how the lender protects itself.
2.
The amount you owe on your credit cards affects your credit history, even if you faithfully pay on your balance every month.
Choose wisely. There is only one correct answer.
True
False
True. The amount you owe accounts for 30% of your credit history.
3.
If you have accounts with a financial institution such as a bank or credit union, it can be advantageous to apply for your first credit card there.
Choose wisely. There is only one correct answer.
True
False
True. The institution will have a sense of how you handle money.
4.
Why might potential lenders be interested in knowing how many times you have changed your address?
Choose wisely. There is only one correct answer.
If you move frequently, that may indicate instability to them
They need to know this for marketing purposes
Frequent movers qualify for special deals
They wouldn't be interested in how many times you have moved, actually
If you move frequently, that may indicate instability to them. Even if you are not financially unstable, lenders may still see it that way.
5.
Personal loans from banks or credit unions must be paid back _______.
Choose wisely. There is only one correct answer.
On a schedule
At your convenience
In one lump sum on a date in the near future
On a schedule. Personal loans, like many loans, are paid back on a set schedule.
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DONE