About This QuizIn today's world, your credit report can have a big impact on your life. Understanding your report and making sure it is accurate are important to your financial wellbeing. Take our quiz to learn everything you need to know about your credit report.
Which of the following may cause you to be denied a line of credit?
Your credit report says you have a lot of debt.
Your credit report says you don't pay your bills on time.
both of the above
Your credit report is reviewed by potential lenders before they decide on extending you a line of credit. Make sure your credit report is accurate and that you understand how it affects your credit rating.
Which facts about your financial life are included in your credit report?
money you will inherit in the future
a bad debt from 20 years ago
your monthly debts
Your credit report includes all kinds of information about your financial life such as how you pay your bills, how you repay loans, how much credit you have available and what your monthly debts are. This credit report helps potential lenders decide whether you are a good credit risk or a bad credit risk.
Credit reports are compiled by:
credit card companies
Credit bureaus, also known as credit reporting agencies (CRAs), collect your financial data from merchants, banks, landlords and others and then sell the report to businesses so they can evaluate your application for credit. The report doesn't specify whether you are a good or a bad credit risk -- it just provides data to those that are interested.
The first groups organized by merchants in the United States to protect themselves from bad debt were known as:
mutual protection societies
both of the above
Merchants and lenders organized groups known as mutual protection societies and roundtables to protect themselves from bad debt. The information they collected was not verified and the groups operated within small local areas only.
In what 19th century decade were the first third-party credit reporting agencies established in the United States?
The first third-party credit reporting agencies, established in the 1830s, had a network of offices throughout the United States. Credit information was sold to interested parties and these agencies developed into the CRAs we know today.
Which personal identifying information is included in your credit report?
The personal identifying information included in your credit report includes your name, address, social security number, telephone number, birth date and current and previous employers.
number of siblings
Your bill-paying history is also known as your:
The credit history section of your credit report includes your bill-paying history with banks, retail stores, finance companies and mortgage companies -- in other words, anyone who has ever granted you credit. It includes information about every account you have, what your monthly payment is, and if you've ever missed or been late with a payment.
monthly banking history
Which public records are considered relevant to your credit report?
your birth certificate
your marriage license
bankruptcy court records
Your credit report will include any public records that may indicate your creditworthiness. Tax liens, bankruptcy records and court judgments are a few examples.
Which section of a credit report is of interest to credit card companies that want to offer you a "pre-approved" card?
credit card inquiries
This section includes a list of anyone who has received a copy of your credit report, anyone who was authorized to view it and anyone who received your name and address for the purpose of offering you credit. Credit card companies seeking to offer you a "pre-approved" credit card don't actually see your credit report, but get your name if you meet their criteria for an offer of credit.
Which type of statement, included in your credit report, allows you to dispute information in the report?
Both the consumer and the creditor can enter dispute statements into the credit report disputing any information already in the report. This hopefully gives interested parties a balanced picture.
The different versions of credit reports available are:
the consumer version
the business version
both of the above
Depending on who is making the request, different versions of your credit report are provided. The business version includes the same information as the consumer version, but only inquiries made by companies with a "permissible purpose" -- usually someone with whom you have initiated business -- are included.
The three-digit number that sums up the information in your credit report is your :
Not a part of your credit report, your three-digit credit score uses a formula to sum up the information in your report. Developed by Fair, Isaac and Company, this scoring formula is used by most creditors and ranges from 300-850, with 300 being the lowest score.
How many major national credit bureaus are there?
Though there are over 1,000 local and regional credit bureaus that gather information about your credit history, there are only three major national credit bureaus -- Equifax, Experian and TransUnion. Since smaller lenders or merchants may only report information to one national bureau, it is a good idea to check what all three are saying about you, as it may not be the same.
Which type of inquiry is considered a "hard inquiry" that may influence negatively how potential lenders view your credit report?
an application for a credit card
When you apply for multiple credit cards, potential lenders may suspect you of being in a precarious financial position, perhaps taking on more debt than you can handle. Think twice before applying for another credit card you really don't need.
requests to view your credit report
requests to view your bank records
What do you need to do to close a credit card account?
Cut the card in half.
Put the card away in a drawer or safe.
Call or write the card company.
Make sure you call or write the card company in order to close a credit card account. Cutting up the card and not using it does not mean the account is closed and it may still have an effect on your credit report.
How many credit cards should you maintain to keep your credit score and debt balances healthy?
four to six
According to TransUnion, you should maintain four to six credit cards to keep your credit score and debt balances healthy, but close any accounts you don't use beyond that. The idea is to avoid excessive available credit.
eight to 12
15 to 20
How many years do payment delinquencies remain on your credit report?
Never miss a credit card payment if you can possibly avoid it. These delinquencies and any accounts that creditors have turned over to collection agencies or given up on, will remain on your credit report for seven years even if you pay up later.
Maxed-out credit lines indicate to creditors that:
You are a savvy spender.
You are in financial trouble.
If your credit cards are maxed-out, creditors may see this as a red flag. Avoid maxing out your cards if you can, and try to divide your debt among different cards.
You don't need any more credit.
Which 1971 United States law specifies who can access your credit report and for what reasons?
The Fair Credit Reviewing Act
The Fair Credit Responsibility Act
The Fair Credit Reporting Act
The Fair Credit Reporting Act (FCRA) states that your credit report can be reviewed by those with whom you have initiated business, such as mortgage banks, car lenders and credit car companies. They need a "permissible reason" to see your report and such requests are considered hard inquires, which go on your report.
How much does it cost to get a copy of your credit report?
The Fair Credit Reporting Act (FCRA) set a maximum price of $10 as of 2005 for your credit report. You are entitled to a copy of your credit report and a list of anyone who has accessed it, as well as a free report once a year under certain circumstances specified in the law.