The Great Credit Race
This is a three-digit number used by lenders to evaluate a borrower's creditworthiness.
What is a credit score?
This document contains information about a person's credit history
What is a credit report?
This factor makes up about 35% of your credit score
What is payment history?
A score between 670 and 739 falls into this category.
What is Good?
This is the cost of borrowing money
What is interest?
Credit scores generally range from this low number to this high number.
What are 300 and 850?
Credit reports include information about payment history, debts, and this type of account activity.
What is credit account activity?
This factor measures how much of your available credit is being used.
What is credit utilization (amounts owed)?
Scores between 300 and 579 are considered this rating
What is Poor?
Borrowers with higher credit scores often receive these.
What are lower interest rates?
Lenders use this to determine how risky it is to lend money to a borrower
What is a credit score?
Reviewing this document regularly can help identify errors and fraud.
What is a credit report?
This factor looks at how long a person has used credit.
What is length of credit history?
Scores from 740 to 799 are considered this rating.
What is Very Good?
A borrower with a 750 credit score is likely to pay this compared to a borrower with a 580 score.
What is less interest?
A higher credit score usually means this when applying for a loan.
What is lower risk?
This section of a credit report shows whether bills were paid on time.
What is payment history?
Opening several new accounts in a short time can negatively affect this factor.
What is new credit?
This rating includes scores from 800 to 850.
What is Excellent?
On a $25,000 loan for 5 years at 5% interest, this is the amount of simple interest paid.
What is $1250?
This group uses credit scores to help make lending decisions.
Who are lenders?
Name at least two reasons a credit report is used to determine qualification.
What is a mortgage, auto, apartment and loan
Having credit cards, auto loans, and mortgages helps demonstrate this factor.
What is credit mix?
Most lenders consider a score of this number or higher to be good credit.
What is 720?
Final Jeopardy
A borrower purchases a car using a $20,000 loan for 5 years. One borrower has good credit and receives a 5% interest rate, while another has poor credit and receives a 12% interest rate. Calculate the difference in interest paid.
Question: What is $7,000 more paid by the borrower with poor credit?
Calculation: