Credit Basics
Credit Vocab
Credit Report
Credit Score
100

What is credit? 

Money that is loaned to you, paid back with interest when payments are made over time, a way to buy now and pay later, availability is based on your borrowing history

100

What is available credit?

The amount of money that you have left to spend (Credit limit - current balance = available credit).

100

What is a credit report?

A record of how you have repaid your debts that lenders report to the 3 credit reporting agencies.

100

What is a credit score?

A rating based on the information in your credit report. It represents your creditworthiness or how likely you are to pay back a loan on time. 

200

What is a credit card? 

a plastic or metal card issued by a financial institution, that allows you to borrow money to purchase goods and services, or to withdraw cash from an ATM

200

What is a credit limit?

The maximum amount of credit available on your account. 

200

Where can you go to access credit reports for free?

200

How long does it take to establish your first credit score?

About 6 months (of on-time payments)

300

Name the 2 different types of credit. 

Installment & Revolving

300

What is the grace period?

The number of days between a consumer's credit card statement date and payment due date when interest is not charged.

300

How often do creditors report information to the credit agencies?

30 - 45 days

300

Name an organization or individual (OTHER THAN A FINANCIAL INSTITUTION with whom you are attempting to borrow from) who can check your credit score. 

Acceptable Answers

Your potential landlord.

Your insurance agent

Your employer

Unsolicited financial institutions who are interested in getting your business

400

Name 2 mistakes that can hurt your credit.

Acceptable Answers

Paying late / missing a credit payment.

Using too much credit/spending over your credit limit.

Opening too many new accounts or loans in a short period.

Closing a credit card account.

400

What is APR?

The annual rate that is charged for borrowing, expressed as a single percentage number that represents that actual yearly cost of funds over the term of a loan.

400

What are the 3 major credit reporting bureaus? 

TransUnion

Equifax

Experian

400

What are the 5 factors make up a credit score?

Payment History

Credit History

New Credit

Types of Credit Used

Amounts Owed

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