Credit Newsletter
Denise Balseca 7/8
The Basics of Credit - Buy Now Pay Later
-Ability to borrow money in return of future payment to the lender that's giving you the money.
What are the forms of credit?
-Personal Loans, Credit Cards and Credit
What costs are associated with credit?
-Pay annual interest (APR or annual % rate)
(Charged for borrowing)
What determines if someone gets credit and how much they get?
-Depending on your credit score, creditworthiness, ability to pay a loan and if you have a good credit.
Also...
- Your Credit Report is an individual's history and record and you will identify if he/she has a good credit.
-Credit Bureau can make companies see if you qualify and get credit.
Vocabulary Watch
3 C's of Credit
Capital
-Value of what you own
-Savings investments, property
-Use capital to pay loan if needed
Capacity
-Financial ability to repay loan
-High enough income
-Major expenses &debt
Character
- Sense of financial responsibility
-Dependability
-Steady Job
-Residence (Long Term)
The Basics Of Credit Cards: What you need to know
Credit Card- Card issued by bank for users as a system of payment
Common Cards: VISA, Master Card, & Discover
Use of Credit Cards- You can use credit cards anywhere
Benefits and Costs
Annual Fee
-Required annual $ amount you must pay 15-$100
Interest (APR)
0%to %29
-Pay entire balance by due date; No interest.
Credit Limits
-Max amount you can spend using card
-Over limit
Approx. $30 from each change made.
Credit Card Fees
Over the limit
-Over credit limit
Late fee
-Making late payment
Penalty Fees
-Additional fee due to late payment, over credit limit, returned payment, etc.
Smart Consumers: Don't Fall Into The Credit Card Trap
-People overuse credit
-Fall into heavy debt
-Can no longer purchase goods- must pay debt
-Decrease demand for goods= decrease need for jobs
-No job= less spending
-Less spending- Lower demand for goods =jobs cut
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Considering Credit Card Costs
- Considering a loan as opposed to using a credit card
- Pay Credit card balance in full
- Choose card wisely
Other tips:
-Avoid too many cards
-Pay in cash
-Do NOT miss any payments
-Read what you sign
-Avoid identity theft
-Seek credit counseling
-Beware of bankruptcy