Answers to the Financial Literacy Quiz

1. Which of the following does not have a direct impact on your credit score?

**The answer is 4; your current credit card/mortgage interest rates do not directly impact your credit score. Your score is directly impacted by factors such as: your payment history, how much of your available credit you’re utilizing, how much outstanding debt you have, and recent applications you’ve made for credit, Therefore, it is important to carefully manage your finances, since your score is viewed as a critical part of your financial reputation.
       
                     1. Your payment history
                     2. Your credit utilization
                     3. Your new applications for credit
                     4. Your current credit card/mortgage interest rates
                     5. Length of your credit history
                     6. Not sure
        

2. What is the average interest rate on a consumer credit card?

**The answer is 2; the current average interest rate is 13.6, but rates are always changing, so it’s important for consumers to read the fine print and understand the agreement they’re signing with their credit card company.
        
                     1. 8-11%
                     2. 12-14%
                     3. 15-17%
                     4. 18-20%
                     5. Not sure

        
3. If a late payment is sent to collections, how long will it remain on your credit report even if you’ve paid it off?

**The answer is 4; it will remain on your report for up to 7 years. Late payments have a big impact on credit score, so it is important to pay every bill on time, even if you’re just making the minimum payment.
        
                     1. 6-11 months
                     2. 1-3 years
                     3. 4-5 years
                     4. 6-7 years
                     5. Not sure

        
4. Which of the following is never included in a credit report?

**The answer is 1; a credit score is never included in your credit report. It is critical for consumers to understand the difference between a report, which contains credit history and public record information… and a credit score. The score is a number that helps lenders predict creditworthiness based on an assessment of the information contained in a credit report at a specific moment in time.
        
                     1. Credit score
                     2. Home address
                     3. Payment history
                     4. Birth date
                     5. Employment history
                     6. Not sure