Credit Newsletter

Plamen Natchev Consumer Ed Period 10

Section 1: The basics of credit

● What is credit?

Credit is someone who has the ability to borrow money but has to pay it back in a certain time limit. For them to increase their credit score.

● What are the forms of credit?

Forms of credit can range from loans for students, loans for housing, credit cards or just personal loans. If you decide to go get a loan you have to talk to a lender. That person has the right to check creditworthiness by getting a report from the credit bureau.

● What costs are associated with credit? The costs that are associated with credit could be utilities, personal items, house payments. But if you use credit you could also build up the interest you owe if you don't pay on time.

● What determines if someone gets credit and how much they get? What determines if how high your credit score is I recommend people with credit should get a credit report so they can keep track of their spending with their credit.

Section 2: Vocabulary Watch

Section 3: Credit Cards: What You Need to Know

● What is a credit card?

A credit card is a plastic card that has money in it that the banks gives you. If you are new they set a credit limit on it.

● Where can you use credit cards? You can use credit cards basically anywhere that has machine at the cash register. But using a credit card irresponsibly that also has a limit and once you exceed that limit you get a over-the-limit-fee.

● What are the benefits and costs of using credit cards?

The costs are annual fees an annual fee is how much money you spend with that card over a year and then you have to pay a certain amount of interest rate or APR . Also if you miss a monthly payment you get a penalty fee. The benefits are only receiving a good credit score. Which is good for getting loans, getting a new job.

Section 4: Smart Consumers: Don’t Fall Into the Credit Card Trap

Safe ways you should use credits card can be a variety of ways. First of all if you know you cant pay something off within a month don't buy it in the first place so you don't end up with debt. because with debt you build interest and fees which takes a long time to pay off. Also there is a minimum fee you have to pay off each month. Don't do it and pay the entire thing. Because your debt carries over the next month and then you have a fee over it which costs like 30 dollars. Another tip is if your out of money on your credit card and you buy something over your limit even though you can pay it off you have to pay a fee for over the limit which is about 30$ fee every time you use your card to buy anything.