Credit Newsletter.

By. Carlos Sanchez

The Basics of Credit

1. What is credit?: Credit it the purchasing of a product and having the ability to paying it later. Obtaining a credit card by your financial institution is based on your credit

2. Types of Credit?: Types of credit include credit cards which are insued by your financial institution and personal loans by a lender.

3. Costs Associated?: Credit it not free! You must pay interest (APR).

4. How? And What determines Credit?: To gain a credit score, you must prove your creditworthiness by the the three C's through your credit bureau. Which gives you your credit score. They are character, capacity and capital.

Section 2: Volcabulary Watch.

1. Credit Score: Credit score is representing by the creditworthiness of a person and the likelyhood that they will pay their debt or returning money that are owed by finicaial institutions like college loans etc.

2. Creditworthiness: Creditworthiness is based on the three C's which are Character Capacity and Capital. Which is as follows, Responsiblity of paying back debt, Financial ability to repay debt, and Value of what you own like personal items etc.

3. Personal Loans: Personal Loans is borrowed money that one has to pay back with interest and for the specific use of personal use. They are typically unsecured loans which are based on your credit score and your ability to pay.

Section 3: What You Need to Know About Credit Cards.

  • What is a Credit Card: Credit Cards are issued by a financial institution or bank which is based on your credit rating.
  • Where can you use them: You can use credit cards almost anywhere when you want to purchases something. Most cards have credit limits or the amount of time a financial institution will extend in order for you to pay your fees which include interest Rate (APR). You get a penalty fee with an annual fees if you don't repay your money that you owe.
  • Benifits of Using a Credit Card: There are some benifits to using a credit card. Some simple benifits is that you just buy today and pay later which can be benificail if you do not have the total amount of the money you are buying. Sometimes you get Over-The-Limit fees if you keep buying things with a maxed credit card.

Section 4: Smart Consumers: Don't Fall Into Team Rockets Trap!

When you are using credit cards, it is important to follow precise rules in order to not fall into Team Rocket's Trap as shown below. Don't use a credit card when buying everything!, whether it be just for buying a simply Coca Cola bottle in the store for one dollar and fifty cents or if you are off in a bar with friends watching the game! Another good thing that one should do is repay your bills that you get using credit cards, that one dollar back of chips can end up costing well over 10 dollars that you have to pay! More importantly, instead of paying with a credit card, why not using realy money instead of a silly plastic card and more importantly! Instead of being a consumer buying worthless stuff instead DIY(Do It Yourself) if something important busts than buying a new one when a simple replacement that you could have in your house saves you money and instead of beinga consumer, be a producer, use your mind and think!! Think freely and break from the trap (:!
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