Question 1

Most creditors rely heavily on borrowers' bank reports when considering loan applications.

Accepted Answer

The answer of Most creditors rely heavily on borrowers' bank...

Question 2

How do creditors determine your credit-worthiness?

Accepted Answer

The answer of How do creditors determine your credit-worthiness?...

Question 3

Your credit report may be issued only if this occurs with your consent.

Accepted Answer

Your credit report can only be legally accessed with your consent.

Question 4

What are the two general rules of measuring credit capacity?

Accepted Answer

The answer of What are the two general rules of...

Question 5

Briefly list and discuss the benefits associated with credit cards

Accepted Answer

The answer of Briefly list and discuss the benefits associated...

Question 6

It is legal for creditors to ask or assume anything about a woman's childbearing plans.

Accepted Answer

It is illegal for creditors to discriminate on the basis of sex, which includes questions or assumptions about a woman's childbearing plans.

Question 7

A credit card cash withdrawal always incurs interest from the moment of withdrawal.

Accepted Answer

When a credit card cash withdrawal is made, interest starts accruing immediately as there is no grace period for cash advances.

Question 8

When you cosign a loan, you are being asked to guarantee this debt.

Accepted Answer

When you cosign a loan, you are agreeing to be responsible for the debt if the primary borrower is unable or unwilling to make the payments. This means that if the borrower defaults on the loan, the lender can come after you for repayment.

Question 9

How can you protect yourself against credit/debit card fraud?

Accepted Answer

The answer of How can you protect yourself against credit/debit...

Question 10

What are the two basic types of credit? Give examples of both.

Accepted Answer

The answer of What are the two basic types of...

Question 11

Briefly list and describe the costs associated with credit cards

Accepted Answer

The answer of Briefly list and describe the costs associated...

Question 12

If you think your bill is wrong, you must notify your creditor in writing within 15 days after the bill was mailed.

Accepted Answer

Under the Fair Credit Billing Act, you must notify your creditor in writing of any billing errors within 60 days after the first bill containing the error was mailed to you.

Question 13

A lender requires a cosigner even when a borrower meets the lender's criteria for making a loan.

Accepted Answer

A lender typically requires a cosigner when the borrower does not meet the lender's criteria for creditworthiness, income, or other factors. If the borrower meets the criteria, a cosigner is usually not necessary.

Question 14

Your friends and neighbors can get credit information about you.

Accepted Answer

Your credit information is not public information and typically can only be accessed by lenders, creditors, or other authorized parties that you have given permission to check your credit. Your friends and neighbors do not have legitimate reasons to access your credit information unless you specifically authorize them to do so.

Question 15

Provincial legislation regarding consumer reporting agencies regulate the type of information that can appear in a credit report and protects the consumer's right not to suffer from false information.

Accepted Answer

Provincial legislation in Canada does regulate consumer reporting agencies and includes provisions for protecting consumers from false or inaccurate information in their credit reports.

Question 16

As a result of the financials crisis in late med to late 2000 decade, new regulations were brought into effect to protect Canadian credit card users. Briefly list and describe these.

Accepted Answer

The answer of As a result of the financials crisis...

Question 17

Some studies show that as many as three out of four cosigners are asked to repay the loan.

Accepted Answer

Some studies have found that as many as 75% of cosigners are asked to repay the loan if the primary borrower defaults.

Question 18

What can you do if your identity is stolen?

Accepted Answer

The answer of What can you do if your identity...

Question 19

Generally, most of the information in your credit file may be reported for only 3 years.

Accepted Answer

Most information in your credit file can be reported for up to seven years, while bankruptcies can stay on your file for up to 10 years.

Question 20

Consumers have three alternatives in financing current purchases, including drawing up on savings, use their present earnings, or borrow against their expected future income

Accepted Answer

These are the three common ways consumers can finance their current purchases.

Quiz 5: Introduction to Consumer Credit