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Flashcards in Credit Deck (22):
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Creditworthiness

A measure of your reliability to repay a loan

1

Character

Measure of your sense of financial responsibility

2

Credit history

A record of your past borrowing and repayments

3

Consigner

Someone who is more experienced assisting a first timer

4

Capacity

A measure of your financial ability to repay a loan

5

Capital

The value of what you own including savings, investments and property

6

Credit bureau

A company that collects information about consumers credit history and sells it to lenders

7

Credit rating

A measure of your creditworthiness

8

3 factors upon which lenders judge creditworthiness

Character, capacity, capital

9

What is a loan application and what is it used for?

The form you complete when you want a loan

10

Where do credit bureaus get their information about adult

Stores, banks, utility compartments on anything

11

A credit rating is based on what numerical scale

300-850

12

Describe the 5 factors that your credit rating is based on

Payment history, current debt, length of credit history, new account and inquiries

13

What steps can one take to increase your credit score

Close any credit accounts that are rarely used

14

What are the immediate steps to repair identity theft?

1. Place an initial fraud alert
2. Order your credit reports
3. Create an identity theft report

15

Three types of identity theft

Tax related identity theft
Child identity theft
Medical identity theft

16

Truth in lending act

Requires all bank to calculate credit cards in the same way. Must provide finance charge/annual % rate

17

Fair credit reporting act

Can check your credit reports

18

Consumer credit reporting reform act

Makes it easier for consumers to correct mistakes in their credit report

19

Fair credit billing act

Help correct credit card billing mistakes

20

Fair debt collection practices act

Stop debt collection agencies from using abusive practices

21

Describe four things you can do to minimize credit risks

Pay more than the minimum
Avoid too many credit cards
Pay cash
Keep accurate records