Student Credit News

What is Credit?

Section 1 The Basics of Credit

What is credit?

Credit is the money that is lent or made available under certain arrangements. Credit can be a good thing or a bad thing. It is important that you do not take it for granted and spend wisely. You also have to maintain your credit score. A Credit Score is a numeric calculation based on what's in your credit report (the higher the number the better) you can get a bad score by being late, missing payments, etc.

What are the forms of credit?

Some forms of credit could be home loans, student loans, credit cards,department store credit cards.

What costs are associated with credit?

Some costs associated with credit would be Annual Fees, over-the limit fees, penalty fees. There are a bunch of costs with having credit and credit cards. If a fee or balance is not paid a bunch of debt with build up and you will not be in a good place for anything.

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

  • character-are u trustworthy,
  • capacity-capability to pay back the loan-
  • creditworthiness-looking at your history, to repay what you have borrowed
  • collateral-what do u have that they can take
  • establish by good credit by paying off your debt

The Credit bureau is in charge of looking at all of this and determining if you can or cannot get a credit card

Section 2 Vocabulary Watch

Credit Report-what you have paid or had not paid--check it once a year. Some sites you can check your credit report are listed below

  • experian
  • transunion
Creditworthiness--The Credit Bureau looks into your history on things, to see if you are repaying debts and how good you are on that and determine this

Lender-- An organization or person that lends money to someone

Section 3 Credit Cards: What You Need to Know

What is a credit card?

It is a little piece of plastic that makes what u want easy to buy. This includes big purchases

There are different kinds of credit cards. There are low limit cards which are good for students, prepaid credit card which involve paying for what your going to pay for anyway also a college based student credit card is good for college students. When you have a credit card you will have a yearly fee, this fee is called the Interest rate. Also with many organizations there is a credit limit. A credit limit is a limited amount of money you are aloud to borrow from the company.

Where can you use credit cards?

Credit Cards can be used anywhere, from department stores to restaurants and even at auto shops. The thing that has to maintained is how much you are spending, because if you do not pay the exact amount on a bill the payment will collect interest. Interest is money that adds on to the original payment or left over amount on a bill that you could not pay at the time.

What are the benefits and costs of using credit cards?

The benefits to having a credit card is that you can buy anything at anytime. The costs of having a credit card is that you have to pay it all back and if you do not it collects interest.

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

Tips on not falling for the credit card traps

  • ALWAYS sign your card
  • Do not share account info to anyone
  • Always use a secure browser
  • Never share passwords
  • Pay more than the min balance
  • Do not max out credit cards
  • Only use for necessities
  • Keep track of what you charge
  • Always pay the bill on time

Sarah Barnes