WISE PRACTICE TEST 2 EXAM SCRIPT 2026
COMPLETE QUESTIONS AND VERIFIED
SOLUTIONS GRADED A+
⩥ When a person brings an item to a pawnshop to obtain cash, the
transaction is considered Answer: A: a collateralized loan.
Since pawnshops make loans based on determining the value of
collateral (a tangible object such as jewelry, cameras, musical
instruments) they receive, the loan is considered a collateralized loan.
⩥ To qualify for a Federal Housing Administration (FHA) loan, a person
must generally Answer: C: fulfill income guidelines.
The Federal Housing Administration (FHA) insures lenders who make
mortgage loans that are riskier than regular bank loans because FHA
loans are made to individuals who usually would not qualify for regular
low-cost mortgages from banks (usually first-time home buyers with
lower income and a weaker credit score).
⩥ Which of the following is considered to be open-end credit? Answer:
C: Department store charge cards.
Open-end credit is a revolving live of credit that is offered by banks and
other lenders to consumers. There is a limit set on the line of credit and
the funds, products or services are accessed using a credit or debit card,
check, store charge card or cash advance
, ⩥ A person has three credit cards with very large outstanding balances
and is unable to make payments on any of them. Which action should
the person take? Answer: C: Notify the credit card companies in order to
negotiate a new payment plan.
When experiencing financial difficulties, the first action to take is to
notify creditors, in this case the three credit card companies. Quite often
the company will assist in negotiating new terms.
⩥ When a person declares bankruptcy that fact will appear on the
person?s credit report Answer: B: for a 10 year period.
Most of the adverse information on a credit report appears for 7 years.
After a declared bankruptcy, the limit is 10 years.
⩥ Consumers who file for bankruptcy are still responsible for: Answer:
C: Tax claims and student loans
Types of debts that are not discharged by a bankruptcy include some tax
claims, alimony, child support, most student loans, claims for punitive
damages for malicious or reckless acts such as driving under the
influence (DUI), and state and federal income taxes.
⩥ Sharon is 20 years old. She has one gas, two bank, and two
department store credit cards. Her application for another credit card has
been declined. The probable reason is: Answer: C: The total amount she
can charge on her cards is more than her ability to repay
COMPLETE QUESTIONS AND VERIFIED
SOLUTIONS GRADED A+
⩥ When a person brings an item to a pawnshop to obtain cash, the
transaction is considered Answer: A: a collateralized loan.
Since pawnshops make loans based on determining the value of
collateral (a tangible object such as jewelry, cameras, musical
instruments) they receive, the loan is considered a collateralized loan.
⩥ To qualify for a Federal Housing Administration (FHA) loan, a person
must generally Answer: C: fulfill income guidelines.
The Federal Housing Administration (FHA) insures lenders who make
mortgage loans that are riskier than regular bank loans because FHA
loans are made to individuals who usually would not qualify for regular
low-cost mortgages from banks (usually first-time home buyers with
lower income and a weaker credit score).
⩥ Which of the following is considered to be open-end credit? Answer:
C: Department store charge cards.
Open-end credit is a revolving live of credit that is offered by banks and
other lenders to consumers. There is a limit set on the line of credit and
the funds, products or services are accessed using a credit or debit card,
check, store charge card or cash advance
, ⩥ A person has three credit cards with very large outstanding balances
and is unable to make payments on any of them. Which action should
the person take? Answer: C: Notify the credit card companies in order to
negotiate a new payment plan.
When experiencing financial difficulties, the first action to take is to
notify creditors, in this case the three credit card companies. Quite often
the company will assist in negotiating new terms.
⩥ When a person declares bankruptcy that fact will appear on the
person?s credit report Answer: B: for a 10 year period.
Most of the adverse information on a credit report appears for 7 years.
After a declared bankruptcy, the limit is 10 years.
⩥ Consumers who file for bankruptcy are still responsible for: Answer:
C: Tax claims and student loans
Types of debts that are not discharged by a bankruptcy include some tax
claims, alimony, child support, most student loans, claims for punitive
damages for malicious or reckless acts such as driving under the
influence (DUI), and state and federal income taxes.
⩥ Sharon is 20 years old. She has one gas, two bank, and two
department store credit cards. Her application for another credit card has
been declined. The probable reason is: Answer: C: The total amount she
can charge on her cards is more than her ability to repay
