Credit Basics
A 3-digit number that shows how trustworthy you are with money.
credit score
This is the MOST important factor in your credit score.
payment history
These three companies create credit reports.
Equifax, Experian, and TransUnion
True or False: Not paying debt can lead to higher interest rates.
True
Best way to avoid interest on a credit card.
pay your full balance on time
A detailed history of your credit accounts and payments
credit report
This factor looks at how much debt you currently owe.
amount owed
Something that is NOT included in your credit report.
your GPA. hehe
True or False: Debt collectors can take legal action.
True
Yasmin wants to build credit and avoid interest, what should she do?
pay her full bill on time every month
A person or company that collects unpaid debts
debt collector
This factor looks at how long you’ve had credit.
length of credit history
What you should do if you find an error on your credit report.
dispute it with credit bureaus
This can happen if you ignore debt collectors.
legal action / wage garnishment / collections
Which debt should you pay first: low-interest or high-interest?
high-interest debt
A credit card that requires a deposit to build credit
secured card
Opening too many accounts at once affects this factor.
new credit
People or organizations that may check your credit.
landlords, employers, or utility companies
A bad habit that keeps you in debt.
only paying the minimum payment
Carl has multiple debts. What should he prioritize?
credit card debt (highest interest)
Bankruptcies and lawsuits that show up on your financial record.
public records
This refers to the mix of credit cards, loans, etc.
types of credit
How often can you check your credit report for free
once a year (at minimum)
The BEST strategy to reduce debt overall.
increase income + cut spending + pay down debt
True or False: You can only check your credit if your score is low.
False