Question 1

What is step two of the steps to resolve a billing dispute?

Accepted Answer

A) Phone call 
B) Letter 
C) Other alternative 
D) Contact an ombudsman 
E) Contact a lawyer

Question 2

A term that refers to the borrower's assets or net worth is called

Accepted Answer

A) capacity. 
B) character. 
C) capital. 
D) collateral. 
E) conditions.

Question 3

College students are not a prime target for credit card issuers.

Accepted Answer

A) True 
 B)False

Question 4

Financing from car dealers in affiliation with car manufacturers is called a conditional sales contract.

Accepted Answer

A) True 
 B)False

Question 5

A loan officer is examining your income and the amount of your existing debt payments to help in the decision to make a loan to you today.Which aspect of the Five Cs of lending is the loan officer most likely looking at?

Accepted Answer

A) Character 
B) Capacity 
C) Capital 
D) Collateral 
E) Conditions

Question 6

What percentage of consumers are rated non-prime based on the VantageScore?

Accepted Answer

A) 16% 
B) 20% 
C) 25% 
D) 9% 
E) 19%

Question 7

Questions you should consider before you decide how and when to make a major purchase include all except

Accepted Answer

A) do I have the cash I need for a down payment 
B) do I want to use my savings for this purchase 
C) could I postpone this purchase 
D) what are the psychological costs of using credit (being in debt and responsible for monthly payments) 
E) all these questions should be considered

Question 8

Consumer credit refers to the use of credit for personal needs (except a home mortgage) by individuals.

Accepted Answer

A) True 
 B)False

Question 9

What percentage of consumers are rated prime based on the VantageScore?

Accepted Answer

A) 16% 
B) 20% 
C) 25% 
D) 9% 
E) 19%

Question 10

If you are an Ontario resident and you have declared personal bankruptcy for the first time, that fact may be reported by credit bureaus for ____________ years.

Accepted Answer

A) 5 
B) 7 
C) 12 
D) 20 
E) 25

Question 11

If you cosign a loan,

Accepted Answer

A) you are not being asked to guarantee the debt. 
B) it is not your legal responsibility to pay the debt. 
C) you'll have to pay up to the full amount of the debt if the borrower does not pay. 
D) the creditor must first try to collect from the borrower. 
E) the creditor cannot garnish your wages.

Question 12

"Shopaholics" and young adults are most vulnerable to misusing credit.

Accepted Answer

A) True 
 B)False

Question 13

If your monthly net (after-tax) income is $1,500, what should be your maximum amount spent on credit payments?

Accepted Answer

A) $200 
B) $300 
C) $400 
D) $500 
E) $600

Question 14

Generally, most of the information in your credit file may be reported for only ______ years.

Accepted Answer

A) 1 
B) 3 
C) 7 
D) 9 
E) 12

Question 15

Consumers have three alternatives in financing current purchases, including drawing up on savings, use their present earnings, or borrow against their expected future income

Accepted Answer

A) True 
 B)False

Question 16

A home equity loan is a good source of credit for daily expenses.

Accepted Answer

A) True 
 B)False

Question 17

What is not consideration of capacity (as part of the 5 Cs of credit)?

Accepted Answer

A) Salary 
B) Previous credit 
C) Place of occupation 
D) Income reliability 
E) Other sources of income

Question 18

When you cosign a loan, you are being asked to guarantee this debt.

Accepted Answer

A) True 
 B)False

Question 19

What percentage of your VantageScore is based on payment history?

Accepted Answer

A) 30% 
B) 28% 
C) 23% 
D) 9% 
E) 1%

Question 20

What percentage of Canadian households carry 1 or more credit cards

Accepted Answer

A) 20% 
B) 30% 
C) 50% 
D) 70% 
E) more than 80%

Exam 5: Introduction to Consumer Credit

What is step two of the steps to resolve a billing dispute?

A term that refers to the borrower's assets or net worth is called

College students are not a prime target for credit card issuers.

Financing from car dealers in affiliation with car manufacturers is called a conditional sales contract.

A loan officer is examining your income and the amount of your existing debt payments to help in the decision to make a loan to you today.Which aspect of the Five Cs of lending is the loan officer most likely looking at?

What percentage of consumers are rated non-prime based on the VantageScore?

Questions you should consider before you decide how and when to make a major purchase include all except

Consumer credit refers to the use of credit for personal needs (except a home mortgage) by individuals.

What percentage of consumers are rated prime based on the VantageScore?

If you are an Ontario resident and you have declared personal bankruptcy for the first time, that fact may be reported by credit bureaus for ____________ years.

If you cosign a loan,

"Shopaholics" and young adults are most vulnerable to misusing credit.

If your monthly net (after-tax) income is $1,500, what should be your maximum amount spent on credit payments?

Generally, most of the information in your credit file may be reported for only ______ years.

Consumers have three alternatives in financing current purchases, including drawing up on savings, use their present earnings, or borrow against their expected future income

A home equity loan is a good source of credit for daily expenses.

What is not consideration of capacity (as part of the 5 Cs of credit) ?

When you cosign a loan, you are being asked to guarantee this debt.

What percentage of your VantageScore is based on payment history?

What percentage of Canadian households carry 1 or more credit cards