Loans
What do loans do to your credit score when taken out?
Lowers it slightly
How does credit utilization impact your credit score?
If your utilization rate is above 30%, it can negatively impact your score
What does APR stand for?
Average Percentage Rate
How many credit cards are ideal?
2-3 cards
Where can you access your credit reports for free?
The 3 Credit Bureaus: Equifax, Experian, and TransUnion (online)
How do you know how much you can get as a loan?
Depending on your credit score you can request a higher loan limit
What are the 5 things that influence your credit score and by how much?
Payment History (35%), Amount You Owe (30%), Length of Credit History (15%), Mix of Credit in Use (10%), and New Credit (10%)
When would you have to start paying APR on a credit card?
When you begin to miss payments
When using a credit card where is the money coming from?
It is loaned from the bank
What is shown on a credit report?
Personal Information, Credit Account History, Credit Inquiries, and Public Records
Do loans have interest rates?
They usually do calculated as a yearly value known as APR
What does it mean when you have a thin file?
Little to No Credit History Available
Someone with a good to excellent credit score is offered what type of interest rates?
Low Interest Rates
What is the difference between a debit and credit card?
Credit Card has a set amount of $ you borrow while Debit Cards is money from your paycheck.
When are credit reports looked at?
When applying for a new line of credit.
Are you more or less likely to qualify for a loan if you have a low credit score?
Less Likely
Why is it important to start building credit young?
Longer credit history, more eligible for loans, credit cards, etc.
Someone with an average to low credit score is offered what type of interest rates?
High Interest Rates
Why are credit reports looked at?
To determine creditworthiness.
What is the most common loan people apply for?
Auto Loans
What is the average APR?
15.2%
How long will a credit card loan go unpaid before it goes to collections?
90 days
How often should you check credit reports?
At least once a year (3 times is recommended)