Chapter 6 Flashcards
The cost of credit, as expressed in a percentage is the _____.
APR.
_____ is a form of security to help guarantee that a creditor will be repaid.
Collateral.
_____ is the income that a person receives after taxes and deductions.
Net income.
The decision of whether you qualify for credit is based on your _____.
Credit score.
When you need to borrow money, a bank, a finance company, or an individual may be the _____.
Creditor.
_____ is the ability to borrow money up to a certain limit set by the company issuing the credit (for an unspecified time limit).
Open-end credit.
_____ is a last resort legal process in which the assets of a debtor are distributed among creditors if they are unable to repay them.
Bankruptcy.
Some people take advantage of the _____, since there are no finance charges added to your account within this time.
Grace period.
An example of open-end credit is a(n) _____.
A credit card charge.
The total dollar amount you pay to use credit is the _____.
Finance charge.
A larger monthly payment is usually the trade-off for a _____.
Short-term loan.
A credit bureau is required to follow reasonable procedures to make sure that _____.
The information in a person’s file is correct.
How should a cardholder begin to correct a mistake on a credit card bill?
Notify the creditor in writing.
The Consumer Credit Counseling Service offers to _____.
Assist with advice and debt repayment plans.
In a Chapter 13 bankruptcy, the debtor usually gets to _____.
Keep most of their property.
Explain 3 of the warning signs that a person is experiencing financial problems.
- Difficulty paying bills on time.
- Increasing debt or reliance on credit.
- Lack of savings or emergency funding.
