Victoria Faso


Credit Score: a number that reflects creditworthiness usually between 300 & 850.

Creditworthiness: reliability to pay back a loan

Interest: APR (annual percentage rate) 0% to 29%

Basics of Credit

Credit is the ability to borrow money in return of a future payment. Credit is not free money, a person must pay interest when the bill is not paid in full.

The forms of credit are credit cards and loans.

A lender can give personal loans for things such as a house or a car.

The costs associated with credit are annual fees usually $15 to $20. If a payment is late then there is late fees that have to be paid.

To determine if a person can get credit and how much, they must prove their creditworthiness, lenders judge this by:

Character: sense of financial responsibility

Capacity: financial ability to repay loan

Capital: value of what you own in case a person cannot pay back the loan in cash

The Credit Bureau has a credit report of every adult and collects info such as bounced checks, missed payments, being sued, and bankruptcy, then they sell it. They are also in charge of a person's credit score.

Credit Cards

A credit card is a plastic card issued by a bank, business, etc., for the purchase of goods or services on credit. There is an annual fee of $15 to $20. There are also credit limits that a person cannot exceed or they will have to pay a over-the-limit-fee.

Credit cards can be used anywhere that has a place to swipe the card, such as businesses like stores and restaurants, also online.

Some incentives are cash back, points, and airline miles, also there are revolving charge accounts that can carry the balance from month to month and then the person only has to pay a minimum amount at the end of each month. A cost of credit cards is having a regular charge account where if a late payment is made then there is a penalty fee (interest fee which leads to paying more money). If the entire balance is paid by the due date there is no interest (APR).


Keep a high credit score, the higher the better. To achieve a high credit score, make payments on time, have a long history of it, keep a limited number of credit scores, and have low debt.

Do not exceed the credit card limit because there will be a fee. Do not spend money that cannot be paid back in full.

Always read what you are signing and be careful for identity theft and debt leading to bankruptcy.