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- 1. Multiple Choice
If you find yourself with a lot of debt, which of these is a RESPONSIBLE strategy for paying off your debts?
Pay your secured debt first so you don't lose your house or car, then worry about your unsecured debt later on.
Pay your unsecured debt first, then worry about your secured debt later on because that debt is backed up by your house or car.
Cut out all unnecessary spending from your budget, and put all the extra cash toward paying down debt.
File for bankruptcy so you can start anew with a clean slate.
- 2. Multiple Choice
Which of the following statements is TRUE?
If your original creditor (ex: credit card company) sells your debt to a collection agency, you no longer have to pay that debt -- it's been forgiven.
If your original creditor (ex: credit card company) sells your debt to a collection agency, you are still required to pay off that debt.
If your original creditor (ex: credit card company) sells your debt to a collection agency, you have a grace period before you have to start making payments again.
If your original creditor (ex: credit card company) sells your debt to a collection agency, the full debt becomes due immediately.
- 3. Multiple Choice
Which of the following is a government agency who can offer education or support if you are struggling with debt, feel your creditors are treating you unfairly, or have been a victim of a scam.
Consumer Financial Protection Bureau (CFPB)
Credit Union Association (CUA)
Federal Deposit Insurance Corporation (FDIC)
Fair Isaac Corporation (FICO)
- 4. Multiple Choice
Which of the following is a key feature of the debt snowball method?
Ranking your debts from largest to smallest debt so you can pay off the largest one first.
Ranking your debts from smallest to largest debt so you can pay off the smallest one first.
Making the minimum payment on all debts and then putting the rest of your money into investments.
Making the minimum payment on all debts and then distributing the remainder between the debts.
- 5. Multiple Choice
Which type of debt typically represents the largest balance owed for most American households?
Student loans
Credit cards
Mortgage
Auto loan
- 6. Multiple Choice
If you are having trouble figuring out how to repay all of your debts, which of these outside supports should you try first?
Hire a bankruptcy lawyer
Work with a debt settlement company
Sign up for a debt management plan
Meet with a certified credit counselor
- 7. Multiple Choice
Which of these actions are debt collectors legally allowed to do?
Call your cell phone and threaten to sue you
Have you arrested due to unpaid debts
Lie about the consequences in order to convince you to pay
Tell your relatives or neighbors about your unpaid debt
- 8. Multiple Choice
Which statement describes the High Rate method for paying off debt?
Paying off the biggest debt at as high a rate as possible
Paying of the smallest debt at as high a rate as possible
Paying off your highest interest debts first so you will pay a lower interest rate overall
Paying off your lowest interest debts first so you will pay a higher interest rate overall
- 9. Multiple Choice
If you stop making your debt payments, which of the following will happen?
All unsecured debts will show up on your credit report
All unpaid debts will show up on your credit report
Only bills sent to collection agencies will show up on your credit report
Only unpaid debts over which you are sued will show up on your credit report
- 10. Multiple Choice
Which of these descriptions best describes the Federal Trade Commission and the Consumer Financial Protection Board?
Government agencies dedicated to educating and protecting American consumers in the areas of credit, debt, frauds, and scams, among other personal finance issues
Nonprofit organizations you can contact if you need to set up a debt repayment plan
Private companies that maintain your credit report and calculate your credit score
Debt collection agencies that can garnish your wages, repossess your house or car, or sue you in order to collect unpaid debts
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