Credit Scores
An indicator of how well someone pays off debt.
What is a credit score?
Using a credit card means you are doing this with money.
What is borrowing?
Something you put up to secure a loan, which you could lose if you fail to repay.
What is collateral?
With this, you make monthly payments but do not own the vehicle.
What is leasing?
An asset that increases in value or equity over time.
This type of score is based partly on your payment history.
What is a FICO score?
This fee is charged when you pay your credit card bill after the due date.
What is a late payment fee?
This type of loan requires collateral.
Response: What is a secured loan?
Going over this limit on a car lease may result in penalties.
What is the mileage limit?
An asset that decreases in value over time.
What is a depreciating asset?
You should check this report for errors and signs of identity theft.
What is a credit report?
Credit card companies may charge stores this 2-3% fee.
What is a merchant fee?
This type of loan does not require collateral.
What is an unsecured loan?
A car is this type of asset because it loses value.
What is a depreciating asset?
This common example of an appreciating asset is where many people live.
What is a house?
True or false: You need a credit card to rent a car or book a hotel.
What is false?
Name any three ways credit card companies make money.
What are interest charges, annual fees, cash advance fees, late payment fees, over-the-limit fees, and merchant fees?
These lenders often charge high fees and target people who are desperate for money
According to Ramsey, this is the smartest way to buy a car.
What is paying cash?
This common example of a depreciating asset loses value the moment you drive it off the lot.
What is a car?
A good credit score does not show this about a person, even though people often assume it does.
What is how wealthy they are (or how well they handle all of their money)?
According to the study guide, this is the best way to avoid credit card debt.
What is buying only what you can afford with cash?
When financing a purchase, you usually pay more than the sticker price because of these two things.
This memory phrase sums up what a lease is.
What is "use it, don't own it"?
Appreciating goes ______, depreciating goes ______.
What are up and down?