Credit

Basics of Credit

What is credit?

Credit is the ability to obtain goods and services before paying. Credit makes buying things easy.


What are the forms of credit?

There are many forms of credit like personal loans which is something for you, for your spending's, like a student loan, car loans, house loans, etc.


What costs are associated with credit?
You have to worry about your credit score is a numeric calculation based on what is in your credit report, which is done yearly. The higher your credit score is the better. Things like paying bills late can affect your credit score.


What determines if someone gets credit and how much they get?

Your credit and how much you get is determined by many things. An easy way to think about it is by "The Four C's". Character meaning are you trustworthy, can your lender, the company that is lending you the money, trust you on paying back. Many lenders will look at things like your credit bureau, which is your collection of credit ratings made available to credit card companies like them Also, Capacity which means are you able to pay back what you spend. Also Creditworthiness which measures your reliability to repay a loan. Lastly, Collateral meaning if you can't pay, what do you have of value that they can take.

Credit Cards: What You Need to Know

What is a credit card?
A credit card is a plastic card issued by a bank, business, etc., for the purchase of goods or services on credit.


Where can you use credit cards?

Credit cards can be used anywhere from a normal retail store to an online store.


What are the benefits and costs of using credit cards?

Some of the benefits of a credit cards are that some offer rewards.

Some costs of having a credit car might be fees. There are different types of fees like penalty fees which are charged when your credit card bill is not payed on time. There is also over-the-limit fees which are charged when your balance goes over your credit limit.

Smart Consumers: Don't Fall Into the Credit Card Trap

It is very important to stay safe while using a credit card because your identity can be stolen.


A few tips to stay safe are:


  • Sign your credit card on the back as soon as you get it
  • Don’t share your information
  • Never share passwords
  • Make sure you are always using a secure browser
  • Don’t max out
  • Pay more than the minimum balance
  • Always pay on time
  • Keep track of what you charge on your card