Credit Terms

Question 1

Spending Limit

Answer 1

The maximum amount you are willing to pay for an item

Question 2

Financially Irresponsibility

Answer 2

Failing to live up to your financial obligations to meet your goals and needs

Question 3

Receipt

Answer 3

A document acknowledging that a person has received money or property in payment following a sale or other transfer of goods or provision of a service

Question 4

Comparison shopping

Answer 4

The practice of comparing the price of products or services from different vendors before buying

Question 5

Debt

Answer 5

Money that must be repaid

Question 6

Credit Card

Answer 6

A plastic card linked to a credit account that can be used to make purchases

Question 7

Installment Credit

Answer 7

Credit used to finance the purchase of a single high-priced item through a series of equal payments made over a set period of time

Question 8

Collateral

Answer 8

Property that can be used as security for a loan

Question 9

Systematic Decision making

Answer 9

The process of making choices that reflect goals by considering all of the pros and cons along with the costs

Question 10

Creditor

Answer 10

A person or business that loans money to others

Question 11

Store account

Answer 11

A credit account that allows you to charge items or services only at that store or with that merchant

Question 12

Buying Plan

Answer 12

An organized method for making good buying decisions

Question 13

Debtor

Answer 13

The person who borrows money

Question 14

Criteria

Answer 14

Standards or rules by which something is judged

Question 15

Revolving credit

Answer 15

An account on which the account holder can charge repeatedly up to a maximum limit

Question 16

Financial responsibility

Answer 16

Being able to meet your financial goals through planned earning, spending, and saving

Question 17

Coupon

Answer 17

A voucher entitling the holder to a discount for a particular product

Question 18

Consumer Loan

Answer 18

A direct loan of cash made to a consumer at a fixed interest rate for a set period of time

Question 19

Rebate

Answer 19

A refund of part of the purchase price of an item

Question 20

Line of credit

Answer 20

A preapproved loan amount that a debtor can borrow as needed with no collateral

Question 21

Credit Report

Answer 21

A statement of your credit history issued by a credit bureau. It is a complete record of your borrowing and repayment performance

Question 22

Extended Warranty

Answer 22

Additional coverage that you can buy to pay for repairs or replacements needed beyond the original warranty period

Question 23

Credit Bureau

Answer 23

A business that gathers, stores, and sells credit information to business members

Question 24

Finance Charge

Answer 24

The cost of borrowing money, including interest and other fees

Question 25

Service Credit

Answer 25

The ability to receive services and pay for them later

Question 26

The minimum payment

Answer 26

The amount you are required to pay each month on a credit account

Question 27

Fixed Interest Rate

Answer 27

An interest rate that is set and does not change from month to month

Question 28

Balance Transfer

Answer 28

Moving a balance from one credit card account to another

Question 29

Penalty

Answer 29

A fee charged for violating a term of the credit agreement

Question 30

Variable Interest Rate

Answer 30

An interest rate that goes up and down with inflation and other economic conditions

Question 31

Cash Advance

Answer 31

Money borrowed against your credit card account

Question 32

Billing Cycle

Answer 32

The amount of time you have to pay your current credit card balance in full to avoid paying interest

Question 33

Grace Period

Answer 33

The period of time between credit card billings