Credit Newsletter

Alexa Cano Period 10

The basics of credit

● What is credit? It is money that you have to pay back with an interest rate.

● What are the forms of credit? Credit cards and Personal loans

● What costs are associated with credit? When you want to get a house or school loan which are Personal loans. Or when a person signs up for Credit cards at stores of banks.

● What determines if someone gets credit and how much they get? Lenders determine if they should lend you money by your credit score and creditworthiness. The Creditworthiness comes from the Credit Bureau. The credit Bureau provides a Credit report. They need to have good Credit.

Credit cards: What you need to know

● What is a credit card? A card issued by a bank allowing the holder to purchase goods or services on credit. The money needs to be paid back. It is not free money.

● Where can you use credit cards? Anywhere.

● What are the benefits and costs of using credit cards? The benefits of using a credit card is that you can buy what you need when you don't have the money on the spot, you can also build up your credit to get more interest. The costs of using a credit card is that 1. You have annual fees that you have to pay. Which is $15-100. 2. If you only pay the minimum you have to pay the rest of the amount the next month + the interest rate. 0%-29% 3. You have a credit limit which means if you go over you have a penalty fee or get declined. 4. You might go over-the-limit fee.

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

  • Don't open up cards with stores or at school, Don't open up too many cards in general
  • If you have a credit card pay your bills on time
  • Don't go over the limit that your bank gave you
  • Avoid minimum payment trap
  • Choose the card that is the least expensive with the greatest benefits