Credit Newsletter

Basics of credit

What is credit?? - credit is the ability to borrow money in return for a promise of future payments. the better your credit score is the more money the bank will let you loan from them. To improve you credit score, you will need to use a credit card and pay it off on time so the bank can see your creditworthiness, which they will let you get better personal loans from a lender. The interest rates will also lower with a better credit score.


Forms of credit?? - The forms of credit are instalment credit, revolving credit, open credit. instalment credit is credit that you use to borrow money and promise to repay in equal amounts over a specific period of time. Revolving credit is credit that allows you to borrow a pre-established amount repeatedly as long as your account is in good standing.


What are the cost associated with credit?

The cost are any type of fees like late fees, paying bills on time, buying a house and purchasing a vehicle?


What determines if someone gets credit and how much they get? - the credit bureau keeps track on how your credit is.

VOCABULARY WATCH

collateral- is when something is pledge as security as payment for a loan.


credit history- record of credit



CREDIT CARDS

What is a credit card? a credit card is a piece of plastic given to you by your bank. this is what you use to pay for bills are anything and you pay off. the bank issues you annual fees to pay and sets a credit limit. if you go over your credit limit you have to pay a over-the-limit fee. there are also other interest rates that you have to pay whenever you use the credit card. If you are late paying off the card you have to pay penalty fees.



where can you use credit cards?

you can use a credit card anywhere that accepts them