By: Genesis Leon Torres
The Basics of Credit
- Credit- Allows you to buy now with the promise of paying later.
- Credit score- A score between 300-850 and the higher the score the better for the consumer.
- Credit Bureau- Organizations to which companies apply for credit information to authorized users for a fee.
- Credit Report- Credit history of a person's past borrowing.
- Creditworthiness- History of repayment and credit score.
- Interest (APR)- Annual percentage rate.
- Lender- Person that lends money.
- Credit Cards- Plastic card issued by a bank for the purchases of good or services on credit.
- Personal Loans- Loan for personal use (family, education, vacations, medical,etc.) This loan is usually unsecured.
Important Credit Vocabulary Terms:
- Grace Period- Certain period of time in which a loan allows payment to be received after the actual due date.
- Credit limit- The maximum amount that you can charge to your credit card.
- Debit Card- This card gives you access to your checking and saving accounts through ATM's and merchant purchases.
Learn About Credit Cards
What You Need To Know
- Annual Fees- Yearly cost of owning a credit card
- Credit Limit- The maximum amount that you can charge to your credit card.
- Interest Rate (APR)- Annual percentage rate
- Penalty Fees- Fees charges if you violate the requirements of your account.
- Over the limit fee- Fee charged when your balance goes over your credit limit.
How to stay safe while using credit cards?
The first thing that you should do to stay safe while using credit cards is sign the card as soon as you receive it and never keep the PIN code with your card. You should be smart while shopping online because online fraud can happen. You should also check your account frequently because the sooner you find a problem the easier it is to fix. If you lose your credit card, report lost or stolen card. Always protect your password, so never share your account information. Finally, handle receipts with care because you should save them to check against your billing statement.