Question

Which situations are examples of how credit scores determine nonfinancial opportunities for consumers? Check all that apply.

Answer 1

Answer:

B. An employer hiring someone to handle financial information

C. An apartment owner gauging whether a tenant might break the rules

D. An apartment owner determining whether to rent a unit to someone

Explanation:

Credit scores are numbers ranging from 300 to 850 that are used to gauge the creditworthiness of individuals. Creditors check the credit history of borrowers to determine how well they have performed over time in prompt payment of debts and maintenance of good financial history. The higher the credit score, the better chances an individual has of being considered for financial favors. In the above scenario,

1. The employer who wants to hire someone to handle financial information would likely want to check if he has a good financial history himself. It would be an indication of his integrity capacity.

2. An apartment owner would use the credit score to gauge the potential tenant's history of keeping to agreements.

3. A potential tenant with a bad and low credit score would likely not keep up with rent payments and would eventually be a bad tenant. So, the apartment owner might then chose not to rent his apartment to such a person.