Creating Credit

Anibal Audon

The Basics of Credit

Credit: the ability to borrow money from something in return

What are the forms of credit? : Loans and credit cards

What costs are associated with credit?: you get interest for every loan, credit score goes down if you dont pay on time

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

The credit Bureau determines if your credit worthiness is good enough for the bank to lend you money

Vocabulary Watch

Credit Score- a grade given to your credit that represents your creditworthiness

Interest (APR): it is a fee paid by money withdrawn

Credit Bureau- record taken of your credit that can tell if your credit is good and you are being responsible with your payments

Credit Cards: What You Need to Know

What is a credit card?

another form of currency that can be used to charge you directly from your bank account

Where can you use credit cards?

anywhere where you can pay for a good or a service

What are the benefits and costs of using credit cards?

credit allows people to use more credit but people also may fall into big debts

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

when using a credit card you need to make sure that you have enough money in your bank account in order to pay for what you owe, also make sure you dont overuse credit.

make sure you dont use many credit cards and always pay your card balance in full.