ECONOMICS
CREDIT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The interest rates on his loan will be lower, since his credit score is low.
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The purchase price of the item he needs the loan for will be higher due to his low credit score
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The monthly payments will be lower due to his lower credit score
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The interest rates on his loan will be higher, since his credit score is low
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Detailed explanation-1: -Credit allows you to get money upfront with the promise to repay it in the future, often with interest. Creditworthiness refers to a borrower’s ability to pay what they’ve borrowed. Lenders judge creditworthiness in many different ways, and they may use things like credit reports and credit scores to help.
Detailed explanation-2: -What financial behaviors will typically lead to a low credit score? Maxing out your credit cards will typically lower your credit score. Your payment history and your amount of debt has the largest impact on your credit score.
Detailed explanation-3: -What might you expect to find out about people who are described as credit risks? They have a history of not making their payments on time. Which is a long-term consequence of making late payments on your bills? It will be harder to secure a new loan at a low rate.
Detailed explanation-4: -Credit is defined as the ability to borrow money to pay back later. A good credit history gives you more options. By Amanda Barroso. Amanda Barroso. Lead Writer | Credit scoring, budgeting, personal finance.