ICFE eNEWS #17-13 - April 3rd 2017
Ask Mr G's "How Credit Savvy Are You?"
By Jim Garnett, a/k/a Ask Mr.G, a member of the ICFE's Board of Educational Advisors
- T or F Using credit can create the
illusion that you are living within your means even if you
are presently spending more than you make.
- T or F Late payments are no big deal
because the average lender allows two late payments per year
before reporting it to the credit bureau.
- T or F A debit card deducts the amount
of your purchase from your checking account immediately.
- T or F You can "opt out" of having a
credit report if you prefer not to have one.
- T or F A good rule of thumb to follow
is "having access to buy, means you can afford to buy."
- T or F Your payment history is the
greatest determination in figuring your credit score.
- T or F Bad credit cannot affect your
ability to get a job.
- T or F To build good credit, make a
small monthly purchase on your credit card and pay the
balance off when the statement comes.
- T or F Your credit score is lowered
each time you check your credit report yourself.
- T or F When you use a credit card, you
are borrowing money, not spending money.
- T or F The rate of interest you pay is
determined solely by how much money you make.
- T or F "AnnualCreditReport.com" enables
you to secure your credit report from each of the three
major credit bureaus once per year.
- T or F A judgment remains on your
credit report for up to 3 years, then it falls off.
- T or F Landlords often check the credit
histories of those making application to rent.
- T or F If you faithfully pay off your
credit card balance every month, the interest rate is not an
(1) True. To find out if you are really living within your
means, put your credit cards in a drawer for 2 months and do not
(2) False. Every late payment is reported on your credit
history and lowers your credit score significantly.
(3) True. You must therefore have enough money in your
checking account to cover the expense.
(4) False. Beginning at age 18, every use of credit will be
reported on your credit report, like it or not.
(5) False. We have access to buy much more than we could ever
(6) True. Payment history comprises 35% of your credit score.
(7) True. Employers will check the credit reports of most
potential employees. A bad credit history can result in problem
situations that carry over to work.
(8) True. Lenders are primarily concerned that you make
payments on time.
(9) False. It does not hurt your credit score to check your
own credit report.
(10) True. Using a credit card is a similar transaction to
taking out a loan.
(11) False. Your rate of interest is basically determined by
your credit history, not your income.
(12) True. This is the only place to acquire a free credit
report annually, no strings attached.
(13) False. Judgments remain on your credit report for 10
years, and if re-executed by the lender each cycle, can remain
an unlimited time.
(14) True. The way you have paid your bills in the past is a
predictor of how you will pay your bills in the future.
(15) True. If you pay off the statement balance each month,
you will not incur finance charges, so it does not matter the
rate of interest.
15-14 - Good job! You will avoid most credit
13-11 - You will be ok in most
credit situations but proceed with caution.
- You are in great danger of making some big credit mistakes.
5-0 - Stick to cash
© Jim Garnett, The Debt Doctor
AskMrG Consulting, LLC
2216 SW 35th Street
Ankeny, IA 50023