Credit Score
What is the lowest credit score you can have?
300
True or False
You must pay off your entire credit card balance each month.
False
True or False
You cannot get a credit card until you are 18 years old.
False
What does APR stand for?
Annual Percentage Rate
What does "BNPL" stand for?
Buy Now, Pay Later
Fill in the blank: The higher your credit score, the ________ your APR.
lower
Give me (2) examples of a credit card reward or perk.
Cash Back (e.g., 1–5% on purchases), Travel Points or Miles, Sign-Up Bonuses (extra points or cash after meeting a spending threshold), Rental Car Insurance, No Foreign Transaction Fees, Exclusive Discounts (on dining, entertainment, or shopping)
Give me 2 examples of a "hidden fee" when using credit:
Late Payment Fees, Over-the-Limit Fees, Cash Advance Fees, Foreign Transaction Fees, Balance Transfer Fees, Annual Fees, Returned Payment Fees (bounced check/insufficient funds)
What is the "Schumer Box" and who does it protect?
The "fine print" on every credit card statement. Meant to protect consumers from banks (predatory lending).
How is paying with credit different than paying with debit?
Credit - You borrow money from the credit card issuer and use their funds to pay for your purchases
Debit - Money comes directly from your checking account
Name 2 of the 3 credit bureaus:
Equifax, TransUnion, Experian
On a credit card statement; what do the terms "credit limit" mean?
The amount available to the person that they can spend on the account. The maximum dollar value they can spend.
List (3) forms of credit
Credit Cards, Lines of Credit, Mortgages, Payday Loans, Student Loans, Personal Loans, Auto Loans, Installment
What is "credit mix"?
% that makes up 10% of a person's credit score. It is made up of all the different types of credit a person uses (loans, credit cards, etc.)
Wonder Woman is looking to purchase brand new Nissan Kick. She has $5000 saved as a down payment. The car costs $29800 and the dealership is offering $1000 cash back incentive. How much of a loan will Wonder Woman need to purchase the vehicle?
$23800
What is the "target range" for people's credit scores. (Score #s and Labels). You need both correct answers.
670 - 850
Good, Very good, to Excellent
What do you call the amount someone has to pay on their statement to maintain their credit score.
Minimum balance
What is the difference between revolving and installment credit?
Revolving - allows for repeated borrowing (up to a limit) with flexible repayment
Installment - you borrow a set amount and pay back regular/equal payments over a fixed period of time.
On a credit card statement, what is the difference between statement balance and current balance?
Statement balance - total amount you owed at the end of your last billing cycle
Current balance - real-time amount you owe right now
If you are buying your 1st car; approximately how much should you have saved up as a down payment?
20% - 30%
What is the difference between your credit report and your credit score?
Credit Score: 3 digit # that summarizes your credit history
Credit History: detailed/comprehensive report of your credit history
Clark Kent charged $4000 to go on vacation with Lois Lane. He isn't going to spend anything else until he pays off the credit card. He can pay $100 each month. If his APR is 16%; what is the balance he still needs to pay after 2 months?
$3906
Define "Finance Charge" and what is it's calculation?
Cost of borrowing money (includes interest and any fees the lender charges)
Calc: Total Cost - Cash Price
What does FICO stand for?
Fair Isaac Corporation (company that created the credit score model) that we now reference as a FICO score.
Clark Kent charged $4000 to go on vacation with Lois Lane. He isn't going to spend anything else until he pays off the credit card. He can pay $100 each month. If his APR is 16%; how much interest will he have paid after 2 months?
$106