econ credit test review
Fair Credit Reporting Act
is a federal law that regulates the collection of consumers' credit information and access to their credit reports. It was passed in 1970 to address the fairness, accuracy, and privacy of the personal information contained in the files of the credit reporting agencies.
ways to increase credit score
make on-time payments.
Capital
money for investment
Chapter 7 bankruptcy
occurs when creditors file a petition of bankruptcy against a debtor who owes them money.
Fair Debt Collection Practices Act
The FTC enforces the Fair Debt Collection Practices Act (FDCPA), which makes it illegal for debt collectors to use abusive, unfair, or deceptive practices when they collect debts.
establishing a budget
help keep you on track and avoid the use of credit cards.
Liens
A charge or claim which one person has upon the property of another as security for a debt or obligation
credit report.
A detailed report of an individual's credit history
Bankruptcy
A legal process to get out of debt when you can no longer make all your required payments
important to pay your bills on time
A missed payment can show up on your credit report for up to seven years.
Installment Plan
A payment plan that allows customers to make payments at set intervals over a period of time until the total debt is paid
Fair Credit Billing Act
Federal legislation that outlines the patient's rights regarding errors on a bill.
Three credit bureau agencies
Equifax, Experian, and Transunion track your credit information.
Career
An occupation undertaken for a significant period of a person's life and with opportunities for progress.
factors can negatively impact your credit score
Applying for multiple credit cards in a short period of time, having a high debt ratio, and not paying your bills on time
certified credit counselor
Consumer Financial Protection Bureau, and the Federal Trade Commission for consumer information.
FICO score.
Credit score from 300-850 that rates how likely a person is to fall 90 days behind in a payment.
Debt Snowball method.
In this method you pay off the smallest loans first, which can be motivating because you will have fewer sources of debt.
installment closed-end credit.
Installment closed-end credit allows the consumer to receive a certain amount of credit to purchase one item or a few goods. One type of installment closed-end credit is a car loan. The car company offers the consumer credit to buy the car. The credit does not extend beyond the sales price of the car. In addition, the person pays the credit in installments over a period of time instead of paying it back in one lump sum.
Repossession
Taking away property due to failure to make loan or credit payments
CARD Act
The Credit Card Accountability, Responsibility, and Disclosure Act of 2009 is a federal law designed to protect credit card users from abusive lending practices by card issuers. Commonly known as the CARD Act, its primary goals are the reduction of unexpected fees and improvements in the disclosure of costs and penalties.
Equal Credit Opportunity Act
The Federal Trade Commission (FTC), the nation's consumer protection agency, enforces the Equal Credit Opportunity Act (ECOA), which prohibits credit discrimination on the basis of race, color, religion, national origin, sex, marital status, age, or because you get public assistance.
Eviction
The legal process of removing a tenant from rental property
Foreclosure
The seizure of property from borrowers who are unable to repay their loans
50/30/20 rule.
This rule states that 50% of your income should be used on obligations and needs. 20% should be used on savings and debt repayment, and 30% on everything else you may want.
Chapter 13 bankruptcy
a reorganization form of bankruptcy for individuals that allows the debtors to keep their property and use their income to pay a portion of their debts over three to five years
Five factors make up your credit report and impact your credit score.
amounts owed, length of credit, payment history, types of accounts, and new credit inquiries
Layaway
an agreement in which the seller reserves an item for a buyer until the buyer pays for the item in full
Revolving open-end credit
credit provided up to a specified maximum amount based on income and credit history; interest is charged each month on the remaining balance
Character
refers to how a person has handled past debt obligations: From the credit history and personal background, honesty and reliability of the borrower to pay credit debts is determined. ... refers to how much debt a borrower can comfortably hand
Collateral
something pledged as security for repayment of a loan, to be forfeited in the event of a default.
Capacity
the amount a company or an economy can produce using its current equipment, workers, capital and other resources at full tilt. In simple terms, it is the financial limit of a business, economy or person.
Conditions
the general economic conditions that can affect a borrower's ability to repay a loan
non-installment credit
the simplest form of consumer credit. It is usually for a very short term, such as 30 days.
Rewards
things you receive in return
