Exam 6: Building and Maintaining Good Credit

Should the person covered by life insurance die before repaying a policy loan,the life insurance company will pay the entire face value of the policy to the beneficiaries.

The value of an asset less the amount owed on a debt used to buy the asset is your stake in the asset.

The willingness of a lender to grant you credit is a good indicator that you can afford the payments required.

Who should set your debt limit?

The APR expresses the cost of credit on a monthly basis as a percentage rate.

The contract for a credit card account is called the

Your total liabilities excluding mortgage debt should not exceed what percentage of your net worth excluding the value of your home if you are to have a manageable level of debt?

Which of the following is not true regarding loans based on the cash values built up in cash-value life insurance policies?

Loans generally require equal payments over a set period of time.

Under the Fair Credit Reporting Act,the law requires

Consumer finance companies make both secured and unsecured loans and require repayment on a monthly installment basis.

The Equal Credit Opportunity Act prohibits the rejection of credit due to a poor credit history.

If the credit bureau refuses to make a correction to an error in your file,you may wish to provide your version of the disputed information by adding a consumer statement to your credit bureau file.

A lender can legally discriminate in granting credit based on

Your credit score can be negatively affected if you borrow from lenders who have low standards.

Usury laws establish

Negative credit information (excluding bankruptcy)can generally be included on a credit file for ____ years.

Data on bankruptcy can be included in your credit file for ____ years.

Although your credit file at each of the three major credit bureaus may differ,your credit scores will be the same.

If information in your credit report is proved to be erroneous,it must be corrected by the credit bureau.