Credit Protection

Question 1

What percent of GDP growth in the United States is a result of consumer spending?

Answer 1

60-70%

Question 2

The Fair Credit Reporting Act of 1971

Answer 2

• Provides that U.S. citizens have free access to their credit reports and credit scores
• Citizens have the right to know exactly why their credit request was denied

Question 3

Established in 2010 to identify dangerous and unfair financial practices.

Answer 3

CFPB - Consumer Financial Protection Bureau

Question 4

What are the 3 national credit reporting agencies?

Answer 4

1) Equifax
2) TransUnion
3) Experian

Question 5

Fico Score Ranges:

Answer 5

800 - 850: Exceptional
740 - 799: Very Good
670 - 739: Good
580 - 669: Fair
300 - 579: Poor

Question 6

What is the most important factor in the determination of a score? How much of a score does it account for?

Answer 6

Payment History, 35%

Question 7

Second most important factor in determining a credit score?

Answer 7

Amounts Owed (Debt burden and credit utilization)

Question 8

Joe has 5 credit cards with a $5,000 limit on each for a total credit available of $25,000. If she owes $2,500, she has a ______ % utilization?

Answer 8

10%

Question 9

What is the 3rd most important factor in determining a FICO score is ? How much does it account for?

Answer 9

Length of Credit History - 15% of credit score

Question 10

What is the fourth most important factor in determining credit score?

Answer 10

Credit Mix - 10% of score

Question 11

Fifth most important element of a credit score?

Answer 11

New Credit - 10% of credit score

Question 12

Why does closing and opening several credit card accounts at once negatively impact credit scores?

Answer 12

Closing accounts changes credit utilization percentages and may affect credit history.