#1
What does a credit score measure?
Creditworthiness
ExplanationAssessment of your likelihood to repay borrowed money
#2
Which of the following is NOT a major credit reporting agency in the United States?
FICO
ExplanationFICO is a credit scoring model, not a reporting agency
#3
What is a credit utilization ratio?
The percentage of available credit you are currently using
ExplanationRatio reflecting your credit usage compared to available credit
#4
Which of the following is considered a good credit score range according to FICO?
701-850
ExplanationFICO's definition of a good credit score range
#5
What is the purpose of a credit score?
To assess your likelihood of repaying borrowed money
ExplanationPrimary purpose of a credit score
#6
What is the highest possible credit score according to FICO?
850
ExplanationMaximum FICO credit score
#7
Which of the following factors has the most significant impact on your credit score?
Payment history
ExplanationRecord of your timely or untimely payments
#8
What does a credit report contain?
Payment history, credit utilization, length of credit history, types of credit used, and new credit inquiries
ExplanationComponents of a comprehensive credit report
#9
How often can you request a free copy of your credit report from each of the major credit bureaus in the United States?
Once a year
ExplanationFrequency of free credit report requests
#10
Which action can potentially have a negative impact on your credit score?
Closing old credit card accounts
ExplanationNegative impact of closing old credit accounts on credit score
#11
What is a 'hard inquiry' on a credit report?
An inquiry that occurs when a lender checks your credit report in response to your application for credit
ExplanationLender's credit check in response to your credit application
#12
What is the significance of a 'soft inquiry' on your credit report?
It only appears on your personal credit report and does not impact your score
ExplanationCharacteristics of a soft inquiry on credit report
#13
What does a 'charge-off' on your credit report indicate?
A creditor has written off your debt as uncollectible
ExplanationMeaning of a charge-off on a credit report