Borrowing MoneyTest Review

If your credit card is lost or stolen and your report it immediately to your credit card company, the most you can lose is

$50

The three primary credit bureaus are:

Experian, Equifax, and Transunion

Who enforces most of the consumer protection laws in Oklahoma?

State Attorney General’s Office

What should you do before applying for a loan?

Get a copy of your credit report to check it for errors

What should you do to dispute any information included in your credit file?

Write a letter to the credit bureau

What else can you do to dispute any information included in your credit file?

File a report online with the credit bureau

Which act ensures all individuals have an equal opportunity to receive credit or loans?

Equal Credit Opportunity Act

True/FalseYou should borrow money to buy a new pair of shoes or to pay for your cell phone bill.

False

True/FalseYou should borrow money to pay off your credit cards.

False

You should borrow money to buy a house.

True

What type of credit includes collateral for the lender?

Secured credit

True/FalsePeople borrow money because they are uniformed about other ways to make purchases.

False

True/FalsePeople borrow money because they do not have enough cash or savings to make a purchase.

True

What type of establishment collects and distributes credit information of individuals and businesses?

Credit Bureau

What is an example of installment credit?

Credit cards

What type of loan is repaid with a fixed number of equal payments?

Installment Credit

True/FalseQualifications for borrowing money are basically the same from lender to lender.

False

True/FalseLenders are most concerned about your ability to repay the loan.

True

True/FalseBuilding a good relationship with a banker can help you get a loan.

True

True/FalseWhen shopping for a loan, it pays to compare lenders.

True

What is known as payment for the use of someone else’s money?

Interest

What score will most lenders check when you apply for a loan?

FICO

What is an official record of a borrower’s credit activity, including borrowing and payments?

Credit History

Which Act requires free credit reports for the unemployed, persons on public assistance, and fraud victims?

Consumer Credit Reporting Reform Act

Which Act prohibits debt collectors from engaging in unfair, deceptive, or abusive practices when collecting debts?

Fair Debt Collection Practices Act

Which Act requires lenders to inform potential lenders about the cost of borrowing money, including finance charges and the annual percentage rate?

Truth in Lending Act

Which Act makes it illegal for groups to make false promises or claims about improving credit history?

Credit Repair Organizations Act

Who is best qualified to repair your credit?

YOU!

What is known as the percentage rate of interest charged to the borrower?

Interest Rate

What is a contract between the borrower and the lender explaining the requirements of fulfilling the loan?

Loan Agreement

How many years can negative information stay on your credit report?

7

What could be considered negative information on a credit report?

Late Payments and Defaults on Loans

True/FalseHigher FICO scores results in higher interest rates.

False

True/FalseHigher FICO scores results in higher payments on loans.

False

True/FalseLower FICO scores result in lower interest rates.

False

True/FalseLower FICO scores result in higher interest rates.

True

What type of lenders offers loans to high risk customers at very high fees?

Payday Loan Companies

What types of lenders offer low risk customers a loan at reasonable fees?

Credit UnionsHome Equity Bank Loans

True/FalseWhen making credit card payments, always pay the minimum amount requested on the statement.

False

True/FalseWhen making credit card payments, always pay more than the minimum amount requested on the statement.

True

What can your credit score affect?

Job, Apartment, Interest Rates

What will your credit score not affect?

Monthly Balance

What is one of the most important factors when computing your credit score?

Pay your bills on time!

True/FalseInterest rates on credit cards vary with your level of income.

False

True/FalseInterest rates on credit cards are basically the same for everyone.

False

True/FalseInterest rates on credit cards will vary greatly, depending upon several factors.

True

True/FalseInterest rates on credit cards will vary little from credit company to credit card company.

False

What are designed to ensure that consumers and lenders are treated fairly and equally?

Consumer Credit Laws

What type of credit is borrowing to buy a car considered?

Secured Credit

What does APR stand for?

Annual Percentage Rate

What is not included in your credit report?

Your age, your race, and the place where you work and your supervisor’s name

What is included in your credit report?

The number of times you apply for credit

What type of clause allows the borrower to make additional payments or pay off a loan early?

Prepayment Clause