By Nicole Lassin
Section 1: The Basics of Credit
- Credit is when you borrow money paying them back in the Future
- Costs of Credit- Pay Interest( APR or annual Percent Rate)
- Using the 3 C's Lenders decide whether your Credit Worthiness
- Character, Capacity, and Capital determines if you can get credit
- Credit Bureau collects info on consumer's credit and sells it
- Credit Bureau decides what the Credit Score is.
- Credit Score- the Higher, the better. Score between 300 & 850
- Credit Report- Apply for credit, provided by Credit Bureau, and it's Credit Information
- Credit Cards- Include Visa, MasterCard, Discover, Amex
- can get cash back, points, airline miles
- Credit Card Costs- Required annual $ amount you must pay
- Interest- 0%-29%
- Personal Loans- establishes consumer credit that is granted for personal use
Section 2: Vocabulary Watch
- Credit Score- The higher you credit score is, the better of you are. Your score is determined by if your bills are paid on time, Low debt, Long history, Limited number of credit cards
- Credit- Borrowing money from the bank, but in return you pay them back in the future
- Credit Worthiness- Show that your reliable to pay them back.
Section 3: Credit Cards: What you need to know
- Credit Card-Regular charge accounts. Must Pay balance in full. Can carry balance from month to month
- Credit Card costs- Annual Fee- Required annual $ amount you must pay $15-$100
- Interest Rate- 0%-29% Pay entire bill on time no interest.
- Credit Limit- Over limit get a penalty/fee. Approximately $30 each day its late, Max amount you can spend
- Over-the-limit-fee is when you go over the credit limit
- Credit Cards can get you to pay higher interest, and additional fees due to late payment, over credit limit, returned payment is called Penalty Fees.
- Credit cards allows people to buy more goods
- People with jobs are able to spend more money
- Use credit to purchase more goods
Section 4: Smart Consumers: Don't fall Into the Credit Card Trap
When using a Credit Card don't spend it on stupid things like parties. Wait until you're out of college to get a credit card because having one during college because it's going to make you have a lot of debt. Having a lot of debt can stop you from getting a house and won't let you get car loans. While having a credit card in college can make you pay money back for the rest of your like.