By Hugo Martinez
The Basic of Credit
What is credit? Credit is the ability to borrow money in return for a promise of future payment; also it is the ability of customer to obtain goods before payment.
What are the forms of credit? The forms of credit is known to be Capacity, Capital, and Character. Capacity is maximum amount that something can contain.
Capital is produced that are used in production of services.
Character is type of unsecured loan made on the basis of the borrower’s reputation and credit. These loans could have interest to pay off.
What costs are associated with credit? Credit information and credit score provided by credit bureaus requested by lenders.What determines if someone gets credit and how much they get?
The higher the number the better on credit score and when you make a purchase companies check credit report. Someone might have money to pay off something in cash what they can do is have a personal loan from the bank depending how creditworthiness you are
Important Vocabulary Terms to Know
liability- responsible for something
Claim- state that something is the case typically without providing proof
Deductible- able to be deducted from tax; taken out
What You Need to Know About Credit Cards
What is a credit card? A credit card is a card by a bank or business for purchase of goods or services on credit having Interest rate on using the card. One does not the the money at the moment to pay what they are purchasing so a credit card is used and a bill comes to pay it off. If you are overdue the bank may be a Interest Rate on you and might have Penalty Fees.
Where can you use credit cards? Businesses and stores such as Sears, Walmart, K-Mart etc. You get the option to pay more and get change back but it isn't that optional. Some local businesses would allow credit cards and some won't such as restaurants.
What are the benefits and costs of using credit cards? You begin when you turn 18, establish credit now will allow you to use credit easily in the future. Regular charge accounts and revolving may apply. Credit cards are best to be used when someone have Credit Limit meaning not using it as much.