Credit Score Basics
Interest rates
Scores, Good or Bad?
Components and their effects (%)
types or loans (fixed or variable)
100

What is credit?

borrowed money

100

On a loan, if you had EXCELLENT credit, would one be charged a higher or lower interest rate?

lower

100

What is the range of good (NOT EXCELLENT) credit score?

690-719

100

The _________ component that helps make up a credit score impacts one's credit score by 35%.

Payment history 

100

Would an auto loan have a fixed or variable interest rate?

Fixed.

200

What is the difference between secured and unsecured debt?

Secured = has a physical item linked to it, meaning the bank has something to take from you.

Unsecured = nothing is attached to the debt, meaning if you do not pay then the bank cannot take anything. has higher interest rate

200

Tom spends $50 on credit, with an interest rate of 9.6%. How much will interest be after 3 months?

$14.4

200

What is the range for a BAD credit score?

 300-629

200

The _________ component that helps make up a credit score impacts one's credit score by 30%.

Outstanding balances 

200

Would a student loan have a fixed or variable interest rate?

Fixed

300
What is a soft inquiry?
A credit check unrelated to specific credit applications.
300

Julie spends $112 on credit, with an interest rate of 7.8%, how much will she be paying in interest if she pays in full at the end of the month?

NONE

300

what is the range of all credit scores?

300-850

300

The _________ component that helps make up a credit score impacts one's credit score by 15%.

Length of history

300

Would a credit card have a fixed or variable interest rate?

variable 

400

What is a common way that one could avoid interest?

Paying off the credit balance in full.

400
If Linda spent $9000 on her balance and $585 on interest, what was her interest rate?

6.5%

400

what is the range for an excellent credit score?

720-850

400

The _________ component that helps make up a credit score impacts one's credit score by 10%. 

(ex. Installment and revolving credit)

Types of credit

400

Would a small business loan have a fixed or variable interest rate?

Fixed
500

What is revolving credit? 

Open line of credit, payments depend on the size of the debt.

500

If one had excellent credit and was applying for an auto loan, what would their interest rate be (or close to).

hint: think about the "Dream Car" assignment.

around 6.85%

500

what is the range for a fair credit score?

630-689

500

The _________ component that helps make up a credit score impacts one's credit score by 10%.

Applications for new account

500

Would a pay day loan have a fixed or variable interest rate?

variable

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