Credit-Borrowing Assessment

Types of Credit/Borrowing

Car Loan, Credit Card, Mortgage, Student Loan, Pay Day Loan, Store Credit Card

Which method calculates the most accurate interest on a loan - Simple Interest or Amortization Schedule?

Amortization Schedule (Loan Payment Calculator)

How often should you check your credit report?

Once a year

Credit

A way for you to buy something now and pay for it later

Debt

The total amount of money you owe other people

Interest

The cost of borrowing money

The maximum amount you can charge/spend on your credit card

Credit Limit

The length of the loan

Loan term

The amount you are charged if you go over your credit limit on your credit card.

Over-the-Limit Fee

Three things to consider when taking out a loan

Purchase Price (Principal), Interest Rate, Loan Term (How Long)

Simple Interest Formula

I= PxRxT (Interest = Principal x Rate x Time)

Payment types that requires you to pay upfront

Pre-paid Card, Money Order, Cashier's Check

Debit Card

A payment method that allows you to withdraw funds directly from your checking account

A payment method that typically charges the highest interest rates?

Payday Loan

The APR (annual percentage rate) on a credit card determines______.

The amount of interest you are charged on credit card purchases.

Making a minimum payment on your credit card means:

You are paying a small portion of your credit card debt

What can cause your credit card's APR to increase?

Missing a credit card payment

What is a credit card balance?

The amount of money you owe the credit card company

How many different credit scores does each person have?

Three

Three Main Credit Reporting Agencies

Equifax, TransUnion, Experian

What is a credit score used for?

To determine how likely individuals are to repay their debts.

A person's credit score can impact the following:

Ability to be approved for loans, ability to get jobs, insurance rates, ability to buy a house or rent

Positive impacts to credit score

paying bills on time, using a small amount of available credit

Negative impacts to credit score

opening multiple credit card accounts, using a large percentage of your credit limit, making late payments

No impacts to credit score

Paying bills in all cash, disputing an item on your credit report, inquiring about a credit card charge, using your debit card, living with your parents and allowing them to pay the bills

What has the biggest influence on your credit score?

Payment History (whether or not you make them and if they are on time)

What is the best way to improve your credit score?

Paying off your debt

Credit Score Range

300-800

A good credit score is____

700+

What should you consider before taking out any loan or borrowing money?

Needs vs. Wants (Do I really NEED this or is it something I WANT?)

Credit-Borrowing Assessment - Subjecto.com

Credit-Borrowing Assessment

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Types of Credit/Borrowing

Car Loan, Credit Card, Mortgage, Student Loan, Pay Day Loan, Store Credit Card

Which method calculates the most accurate interest on a loan – Simple Interest or Amortization Schedule?

Amortization Schedule (Loan Payment Calculator)

How often should you check your credit report?

Once a year

Credit

A way for you to buy something now and pay for it later

Debt

The total amount of money you owe other people

Interest

The cost of borrowing money

The maximum amount you can charge/spend on your credit card

Credit Limit

The length of the loan

Loan term

The amount you are charged if you go over your credit limit on your credit card.

Over-the-Limit Fee

Three things to consider when taking out a loan

Purchase Price (Principal), Interest Rate, Loan Term (How Long)

Simple Interest Formula

I= PxRxT (Interest = Principal x Rate x Time)

Payment types that requires you to pay upfront

Pre-paid Card, Money Order, Cashier’s Check

Debit Card

A payment method that allows you to withdraw funds directly from your checking account

A payment method that typically charges the highest interest rates?

Payday Loan

The APR (annual percentage rate) on a credit card determines______.

The amount of interest you are charged on credit card purchases.

Making a minimum payment on your credit card means:

You are paying a small portion of your credit card debt

What can cause your credit card’s APR to increase?

Missing a credit card payment

What is a credit card balance?

The amount of money you owe the credit card company

How many different credit scores does each person have?

Three

Three Main Credit Reporting Agencies

Equifax, TransUnion, Experian

What is a credit score used for?

To determine how likely individuals are to repay their debts.

A person’s credit score can impact the following:

Ability to be approved for loans, ability to get jobs, insurance rates, ability to buy a house or rent

Positive impacts to credit score

paying bills on time, using a small amount of available credit

Negative impacts to credit score

opening multiple credit card accounts, using a large percentage of your credit limit, making late payments

No impacts to credit score

Paying bills in all cash, disputing an item on your credit report, inquiring about a credit card charge, using your debit card, living with your parents and allowing them to pay the bills

What has the biggest influence on your credit score?

Payment History (whether or not you make them and if they are on time)

What is the best way to improve your credit score?

Paying off your debt

Credit Score Range

300-800

A good credit score is____

700+

What should you consider before taking out any loan or borrowing money?

Needs vs. Wants (Do I really NEED this or is it something I WANT?)

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