Exam 6: Using Credit

Mike has a MasterCard with an annual fee of $25,18% interest,and a $1,000 credit limit.He always pays the total outstanding balance monthly.His most recent monthly statement lists last month's payment,new charges this month totaling $1,500,and a $30 fee.That fee is most likely

Theresa is a bit of a spendthrift.She has trouble saying no when it comes to buying things.Which of the following cards would keep her out of debt?

Leon has a home valued at $216,000 and an outstanding mortgage of $140,000.If his lender is willing to provide a home equity loan of up to 80% of market value,how much could Leon borrow using a home equity loan?

As well as being among the cheapest forms of consumer credit,these offer shelters from taxes:

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A person who pays his credit balance off every month should look for a credit card with a [long | short] grace period.

The ____ is really a second mortgage on your home.

A ____ is an agency that provides credit information about individual borrowers to lenders.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The first step to take in establishing a credit history is to [get a credit card | open checking and savings accounts].

One can lose his home if he does not repay his home equity line of credit.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -In the year after the Credit Card Act of 2009 was passed,there was a(n)[increase | decrease] in the use of debit cards relative to credit cards.

A credit limit refers to the maximum amount the cardholder can owe the issuer at any point in time.

Being late on credit payments only 2-3 times per year may label you a "late payer" in your credit file.

Credit cards often have penalties for late payment and for exceeding credit limits.

It is safe,and often required,to give your Social Security number as a form of identification when using a credit card.

Credit card payments received the next business day after a holiday or weekend due date are considered on time.

Advantages of balance transfers can include lower interest rates and the convenience of consolidation.

The quality of your credit rating is maintained by

Ann Marie accumulated a large balance on her credit card while in college.She is trying to get it paid off as quickly as possible and wants to roll the balance onto a new credit card.She now uses a credit card only for emergencies.What should Ann Marie look for in a credit card given the large balance and the way she plans to use the card?

____ are not a type of open account credit.

​If your credit card company increases your interest rate,the new rate can only be applied to new charges,not to preexisting balances.