Credit Newsletter

Oscar Ayala

Section I: The basics of Credit

Credit is defined as confidence in a borrower's ability and intention to repay. Based on how well an individual pays, that determines their Credit Score. The Credit Bureau is a company that collects your credit score and makes them available to other companies. The Credit Bureau gets all of this information from your Credit Report which is a document of all your past repayments. Your Creditworthiness is how good or how well you have been in your past essentially giving you your credit score. The three types of credit are are installment, revolving, and open credit. Installment credit is a credit that you use to borrow money and promise to pay equal amounts over a specific period of time. An example is lets say Pedro buys an auto loan in which he has to pay $400 a month. A revolving credit is a credit that allows you to borrow a pre-established amount repeatedly as long as your account is in good standing.However, you have to pay your payments in full or monthly with a slight interest or fees. An example is if Pedro signs up for a Credit Card and decides to buy something, borrowing money from the bank( a lender). He can decided to pay it off in a full payment or pay the minimum monthly payment. Open Credit is the type of credit that has to be paid in full every month. An example would be is Pedro has a company charge card in which he pays his business expenses. At the end of the month he will receive a bill in which he has to pay in full. How people get credit and how much they get is based on how well you pay your payments back. How you build things up is by first getting personal loans and then having the ability to pay it back

Section II: Vocabulary Watch

Checks and tranfers

A cashiers check is a check written from the bank itself with the banker's signature. A different type of check is a traveler's check. This type of check is used when people go out of state or country for traveling purposes. A wire transfer or a credit transfer is a method of transferring money from one person or institution to another.

Section III: Credit Cards: What You Need to Know

A credit card is a payment card issued to users as a system of payment. For your convenience of using the card Annual Fees are given to you per year that can range from $15 to $30. However every card has its own credit limits. This means that its how much your credit card company will let you take out at once with your card. You can use credit cards pretty much everywhere. You can use them to buy things online or if you don't have cash handy. Also, as you build up your credit score, you can then later take out house loans and other loans of that matter. Every credit card has its own benefits and costs. C