FiCEP Credit Reports and Scoring 2

Question 1

Which factor has the greatest impact on a FICO credit score?

Accepted Answer

Payment history

Answer

Length of credit history

Answer

Credit utilization ratio

Answer

Types of credit used

Question 2

A client has a credit utilization ratio of 78%. What does this indicate?

Accepted Answer

They are using too much available credit; target is below 30%

Answer

They are using credit well; target is 80%

Answer

This ratio only matters for business credit

Answer

This is healthy for building credit

Question 3

How long does a Chapter 7 bankruptcy remain on a credit report?

Accepted Answer

10 years

Answer

5 years

Answer

7 years

Answer

15 years

Question 4

What is the difference between a hard inquiry and a soft inquiry on a credit report?

Accepted Answer

Hard inquiries occur when applying for credit and can lower scores; soft inquiries do not affect scores

Answer

There is no difference

Answer

Soft inquiries lower scores more

Answer

Hard inquiries are only from mortgage lenders

Question 5

A client finds an unfamiliar account on their credit report. What should the counselor recommend?

Accepted Answer

File a dispute with all three bureaus, place a fraud alert, and consider a credit freeze

Answer

Ignore it if in good standing

Answer

Close the account and move on

Answer

Wait to see if it resolves itself

Question 6

Which credit score range is generally considered 'good' by most lenders?

Accepted Answer

670-739

Answer

300-579

Answer

580-669

Answer

740-799