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- The cardholder is responsible for authorized charges made before losing the card. Mike used his travel card to purchase airfare, lodging, rental car, gasoline, meals, and parking, and used an ATM to obtain a cash withdrawal. Which expenses must Mike...
- Because it provides easy access to statements, payments, and mobile alerts. What should you do if there are incorrect transactions on your monthly statement? File a dispute with the GTCC vendor within 60 days of the statement date. Army Travel Card...
- Reduced Payment Plan Which item is a benefit of using the travel card? Using it prevents travelers from having to use their own money for official travel expenses. The traveler refuses to authorize a credit check. Account delinquent after 61 days. Which of the following statements about a lost or stolen travel card is true? The card holder is responsible for authorized charges before losing the card. Mike used his travel card to purchase airfare, lodging, rental card, gasoline, meals and parking and used an ATM to obtain cash withdrawal. All the listed expenses, including the cash withdrawal. Which statement applies only to restricted cardholders?
- Why should you establish an online account with the travel card vendor? Was this helpful? Let us know if this was helpful.
- Test Your Credit Score Knowledge Most people know that having a good credit score makes life a lot easier. But do you understand what goes into a stellar score and how to keep yours above par? Find out just how credit savvy you are and test yourself on some of the finer points. Take the quiz My score is affected whenever someone requests a copy of my credit report. If you request a copy of your own credit report, this is a soft inquiry. Next question Credit reporting agencies base my scores solely on information provided by my lenders. Next question Closing a credit card helps my credit score. True False Your credit limit on the closed card drops to zero, reducing the overall amount of credit available to you. This may affect your credit utilization ratio — the total of your balances divided by the total money you can borrow.
- The lower your ratio, the better your score typically is. True False As the saying goes, nothing lasts forever, but a late payment will lower your score for a while. The good news is that it will affect your score less as time passes. Missing a payment affects your score more in year one than it will in year six. Next question Consolidating my debts will hurt my credit score.
- True False Generally, yes. Your score may go down if you move your credit card balances to an installment loan because the new lender will look at your credit report before approving you. This results in a hard inquiry, and hard inquiries may bring your score down. Next question Loan approval depends on more than just my credit score. True False It can. Potential lenders might also look at your employment history, financial assets available to you and how much of a down payment you're able to make. Next question Paying my credit card balances in full each month can help my score.
- True False Starting to pay your card balances in full each month may not improve your score immediately. But consistently paying off your credit cards and not carrying a balance will likely lead to better credit scores in the long run. Next question Shopping around for the best terms on a loan will hurt my credit score. True False Not necessarily. Most credit scoring models allow for price comparison and will lump hard inquiries made by similar lenders together for a limited period of time. Next question Getting married creates a joint credit score. True False Your credit score is essentially linked to your Social Security number. Activity on jointly held loans, however, affects both spouses' credit scores. Next question My credit score changes every month.
Americans Struggle With Basics Of Credit Cards And Scores — Do You? Try This Quiz
True False Your credit score has a big impact on the interest rate you receive, and lenders take a risk when they extend credit to consumers with scores on the low side. They typically want something to show for it so they charge more interest. True False Lenders understand that life happens — you might have an exceptionally busy week or several unplanned expenses to meet at any given time and miss an exact due date.- They typically do not report an account as delinquent until payment is 30 days past due, and being 60 days late can hurt your score even more. How Credit Savvy Are You? Scroll up to see your answers OR Retake the quiz You got correct! Your results: Credit Proficient — Your credit knowledge is pretty solid. Your results: Eager Credit Student — When it comes to credit, you just need to study up! Either way, brushing up on the basics will have you at the top of the class in no time. To raise your credit IQ, check out the Credit Advice section on our blog. The good news is? Read up on all things credit in the Credit Advice section on our blog. Scroll up to see your answers OR Retake the quiz.
- Credit Myths: True or False? For example, does getting turned down for a credit card hurt your credit score? Can using a debit card help your credit score go up? Is it bad to check your own credit report? Find out the answers to these common credit card questions as you test your knowledge with this quick true or false quiz! True or False: Your credit report is the same as your credit score. Your credit report and your credit score are actually two different things. Your credit report contains information about your credit use and activity. The information in your credit report is used to create your three-digit credit score, which is the number that lenders use to determine how likely you are to repay or not repay your debts. Although, in theory, it makes sense that TransUnion, Experian, and Equifax should all have the same information about your credit activity on file, it rarely happens that way.
- A credit card lender might report an inquiry or a missed or late payment to one bureau but not all three, for example. Or, one report might contain an error. Bottom line? Look at them every year, and pay special attention to any differences you see. True or False: Getting turned down for a credit card will hurt your credit score. You probably know that when you apply for a new credit card, a new inquiry shows up on your credit card. And, you probably also know that each new inquiry lowers your credit score a tiny bit. So, any time you apply for new credit, your credit score goes down a little bit.
- That new line of credit means that you now have more available credit at your disposal — and the more unused, available credit you have, the higher your credit score. True or False: Checking your own credit report can be good for your credit score. In fact, checking your own credit report might actually help raise your credit score — you might find an error or evidence of fraudulent activity. True or False: Responsible debit card use can help boost your credit score. So, how many questions did you get right? Did any of these answers surprise you? Have you learned any surprising credit card lessons recently?
Test Your Credit Knowledge Answer Key - Practical Money Skills
Erika Rasure, Ph. She is an expert in personal financial planning and practices as a financial therapist. Article Reviewed on April 29, Erika Rasure Updated Apr 29, Financial institutions attempt to mitigate the risk of lending to borrowers by performing a credit analysis on individuals and businesses applying for a new credit account or loan. This process is based on a review of five key factors that predict the probability of a borrower defaulting on his debt. Called the five Cs of credit , they include capacity , capital , conditions, character, and collateral. There is no regulatory standard that requires the use of the five Cs of credit, but the majority of lenders review most of this information prior to allowing a borrower to take on debt.- Lenders measure each of the five Cs of credit differently—some qualitative vs. Although each financial institution employs its own variation of the process to determine creditworthiness , most lenders place the greatest amount of weight on a borrower's capacity. Capacity Lenders must be sure that the borrower has the ability to repay the loan based on the proposed amount and terms. For business-loan applications, the financial institution reviews the company's past cash flow statements to determine how much income is expected from operations. Individual borrowers provide detailed information about the income they earn as well as the stability of their employment. Capacity is also determined by analyzing the number and amount of debt obligations the borrower currently has outstanding, compared to the amount of income or revenue expected each month. Most lenders have specific formulas they use to determine whether a borrower's capacity is acceptable.
- Mortgage companies , for example, use the debt-to-income ratio, which states a borrower's monthly debt as a percentage of his monthly income. A high debt to income ratio is perceived by lenders as high risk, and it may lead to a decline or altered terms of repayment that cost more over the duration of the loan or credit line. Capital Lenders also analyze a borrower's capital level when determining creditworthiness.
- Capital for a business-loan application consists of personal investment into the firm, retained earnings, and other assets controlled by the business owner. For personal-loan applications, capital consists of savings or investment account balances. Lenders view capital as an additional means to repay the debt obligation should income or revenue be interrupted while the loan is still in repayment. Banks prefer a borrower with a lot of capital because that means the borrower has some skin in the game. If the borrower's own money is involved, it gives them a sense of ownership and provides an added incentive not to default on the loan. Banks measure capital quantitatively as a percentage of the total investment cost. Conditions Conditions refer to the terms of the loan itself, as well as any economic conditions that might affect the borrower.
- Business lenders review conditions such as the strength or weakness of the overall economy and the purpose of the loan. Financing for working capital , equipment, or expansion are common reasons listed on business loan applications. While this criterion tends to apply more to corporate applicants, individual borrowers are also analyzed for their need for taking on the debt. Common reasons include home renovations, debt consolidation , or financing major purchases. This factor is the most subjective of the five Cs of credit and is evaluated mostly qualitatively. However, lenders also use certain quantitative measurements such as the loan's interest rate , principal amount, and repayment length to assess conditions. The old adage that past behavior is the best predictor of future behavior is one that lenders devoutly subscribe to.
- Each has its own formula or approach for determining a borrower's character, honesty, and reliability, but this assessment typically includes both qualitative and quantitative methods. The more subjective ones include analyzing the debtor's educational background and employment history; calling personal or business references; and conducting a personal interview with the borrower.
- More objective methods include reviewing the applicant's credit history or score, which credit reporting agencies standardize to a common scale. Although each of these factors plays a role in determining the borrower's character, lenders place more weight on the last two. If a borrower has not managed past debt repayment well or has a previous bankruptcy , their character is deemed less acceptable than a borrower with a clean credit history. Collateral Personal assets pledged by a borrower as security for a loan are known as collateral. Business borrowers may use equipment or accounts receivable to secure a loan, while individual debtors often pledge savings, a vehicle, or a home as collateral.
- Applications for a secured loan are looked upon more favorably than those for an unsecured loan because the lender can collect the asset should the borrower stop making loan payments. Banks measure collateral quantitatively by its value and qualitatively by its perceived ease of liquidation. The Bottom Line Each financial institution has its own method for analyzing a borrower's creditworthiness, but the use of the five Cs of credit is common for both individual and business credit applications. Of the quintet, capacity—basically, the borrower's ability to generate cash flow to service the interest and principal on the loan—generally ranks as the most important.
- But applicants who have high marks in each category are more apt to receive bigger loans, a lower interest rate , and more favorable repayment terms. Compare Accounts.
- Reading time: 3 minutes Learning the ins and outs of credit scores can be beneficial There are many different credit scores Negative information on your credit reports can impact your credit scores Your credit scores can play a role throughout your life -- like the process of buying a home, getting a job or determining what loans you're offered -- and at what terms. That's why knowing the ins and outs of your credit scores can be essential to understanding your personal finances. How much do you know about your credit scores? Take our quiz and find out. Which of the following most influences your credit scores? While the items listed may influence your finances, they generally won't have any effect on your credit scores. Income, marital status and denial of a credit application are not factors considered in calculating credit scores.
- Do you have more than one credit score? Many people are surprised to find out they have more than one credit score. Your scores can vary for several reasons, including the company providing the credit score, the data on which the credit score is based and the credit scoring method or ways of calculating your credit scores being used. The types of credit scores used by lenders and creditors can also vary, based on the industry. You can find more information about how credit scores are calculated here.
- Generally, which of the following most influences your credit scores? A The types of credit accounts you have B Your payment history C The amount of credit you're using compared to the total amount available to you D The length of your credit history B. While all the items listed are generally contributing factors when your credit scores are being calculated, your payment history typically is the largest factor in most credit scoring models. For more information, check out this infographic. Does getting married change your credit scores? You maintain your own independent credit history even after you get married. If you and your spouse open joint accounts, then both of your credit scores will reflect how that account is handled moving forward, but marriage itself does not impact your credit scores. Do good credit scores guarantee you'll be approved for credit?
- It's important to remember there is no "magic number" that will guarantee approval when it comes to credit scores. In addition to the many different credit scores available, lenders and creditors may have their own criteria for approval and may evaluate factors such as your income in making their decision. A One of many types of credit scores B How much of your credit you're currently using compared to the total amount available to you C How many times you've recently applied for credit D How many times you've made a payment late or missed a payment A. Like other types of credit scores, a FICO score is a three-digit number, based on information in your credit reports, that is designed to represent your credit risk, or the likelihood you will pay your bills on time. Your credit scores are calculated using information in your credit reports, although there are many different credit scoring models. If you have negative information, such as late or missed payments, on your credit reports, your credit scores typically will be impacted.
- Checking your credit reports and credit scores regularly may help you better understand your credit situation. You're entitled to a free copy of your credit reports every 12 months from each of the three nationwide credit bureaus by visiting www. You can also create a myEquifax account to get six free Equifax credit reports each year. A VantageScore is also one of many types of credit scores. Related Content.
- Poor credit: — Bad credit: below One of the advantages of having a favorable credit score is that you can get a lower interest rate, meaning you will pay less over time. B: Your payment history The score is based on how often you pay your bills on time or if you are late on payments. C: Your birth date Your personal information, such as your age, birth date, and where you live, does not affect your score. If you are a divorced Solo Mom, your divorce proceedings will not affect your credit score; however, if you have had joint accounts with your former spouse and this person does not pay his or her share, even though the two of you are divorced, those issues will affect your credit score.
- D: All of the above Your credit extends beyond whether or not you can get a credit card but is also used by potential employers and landlords as part of their selection process. Is this fair? No, but it is legal. C: Once a year You should check your credit once a year, and no, it does not hurt your score if you check your credit more often. The reality is that our credit score is constantly changing and is different at each of the credit bureaus. The Fair Credit Reporting Act entitles you to one free credit report from each credit bureau every 12 months. You can purchase your score from the bureaus for a small fee. There are also websites that offer free versions of your score. And thanks to the Dodd-Frank Act , creditors are legally required to tell you your score if you are denied credit. A: Yes Yes, yes, yes! Sometimes there is inaccurate or negative information e.
- Unfortunately, it can take a while to remove information, and the process can be arduous. The good news is that it can be fixed. You have to go to each bureau to fix each discrepancy, and credit bureaus have to respond and resolve a dispute within 30 days. The Federal Trade Commission has some information on how to fix your credit yourself. Many organizations can help you sort out your credit issues and finances.
- Although our credit does not define us, having this knowledge gives us the power to make choices. Answers for this quiz were researched through the Consumer Federation of America and the Federal Reserve. Do you have financial questions? Tanisha Christie is an interdisciplinary performing artist and filmmaker. After years of working at the nexus of arts, media, social justice, and healing, she is currently finishing her master of social work clinical specialization at Hunter College in New York City.
- A child of a Solo Mom, she loves to ride her bike to the beach. Please feel free to contact us with any comments or questions.
- Maxed out Credit Cards Payment History A history of the payments you have made on all credit you have obtained, which affects your credit score. Tracks such things as whether or not you pay your bills on time, whether or not you always pay at least the minimum amount, etc. Length of Credit History II. Payment History III. Amounts Owed IV. Hard Inquiry Occurs when someone checks ur Credit History to make a lending decision. Did you know? You inquire about a credit card charge. Which of the following MOST influences your credit score? All of the above. Paying off your Credit card bill Jose wants to be sure he maintains a high credit score as he is planning to buy a new car soon. What should he do to ensure his score stays high, allowing him to buy his dream car? Pay off his Credit Card Balance each Month Having a good credit score is important because: It can impact your ability to be approved for bank loans In which of the following situations is having a good credit score important?
Credit Cards: Find The Right Offer For You & Apply Online - Bankrate
You forgot to pay the cable bill. If your credit reports show different scores, what should you do? Get in touch with credit bureaus to see if they have different or inaccurate info on your credit history Having a good credit score is important because: A. It can impact your ability to be approved for bank loans C. It can impact how much you will have to pay the government in taxes D. It can impact how much you will have to pay for college B. It can impact your ability to be approved for bank loans Which of the following is true of a person with a high credit score?- They are more likely to pay bills on time. They are less likely to pay off debts. They probably have a high balance on multiple credit cards D. Both B and C are correct. Which of the following actions has NO impact on your credit score? You use a large percentage of your credit limit. You opened several new credit cards last week. You send in your credit card payment a couple days late.
- You disputed an item on your credit report. You pay all your bills in cash. You use a small amount of your available credit. Jose wants to be sure he maintains a high credit score as he is planning to buy a new car soon. All are things he should do to increase or maintain his credit score. Pay off his credit card balance each month. Open a savings account at the local bank. Test drive several cars before deciding which to buy. Which behaviors might lead someone to have a low credit score?
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