Credit Newsletter

By:Karina Arteaga

Section 1: The Basics of Credit

● What is credit?

The ability to obtain goods or services before payment, based on the trust that payment will be made in the future

● What are the forms of credit?

The forms of credit are by credit cards and loans.

● What costs are associated with credit?

Credit cards are free but you must pay interest.

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

In order to get credit a person must demonstrate their creditworthiness. Lenders judge using three factors character, capacity, and Capital. They obtain this information from a Loan application and the credit bureau. A person then gets a credit score between 300 & 850, the higher the better

Section 2: Vocabulary Watch

Credit- The ability to obtain good or services before payment, based on the trust that payment will be made in the future.

Credit Bureau- A company that collects the credit ratings of individuals and makes them available to credit card companies, financial institution, etc.

Credit History- A record of an individuals or company's past borrowing and repaying

Section 3: Credit Cards: What You Need to Know

● What is a credit card?

A credit card is a plastic card issued my a bank or business that can be used for the purchase of goods and services.

● Where can you use credit cards?

You can use a credit card anywhere where its accepted.

● What are the benefits and costs of using credit cards?

The benefits of using a credit card can be that you build your credit score and with time it will be easier to get accepted for things such as home or a car. Some costs of using a credit card can happen if you go over your credit limit you will get a over-the-limit fee. You can also get penalty fees for doing late payments and going over credit limit and increase Interest Rate.

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

To be a smart Credit card user you must before think of how to set some guidelines for yourself and you must also realize that by having a credit card it doesn't mean you have more money to spend. You must know how not be an impulsive buyer and just by things that you considered you really need and are neccessary. Another way to be a smart credit card buyer is to pay your balance fees when there due and if possible sooner.