Consumer Credit

The basics of Cunsumer Credit.

Name the five C’s of consumer credit

1. Charcter

2. Capacity

3. Capital

4. Credit History

What is comsumer credit?

A major force in the American economy and the use of credit in family fincanial planning.

What are the factors you should consider when choosing a loan or credit card?

Can you afford the item?

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Do you have the cash you need to borrow the money you need to make the down payment?

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Can it wait until later?

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What are the costs of using credit?

what is open - end credit?

similar to a loan, with a certain amount of money you can barrow for a variety of goods and services.

Closed - end credit

is only a one time loan. that you will pay back with a certain amount of time. This tpye of credt nvoles having a definte amount of money.

How can i build my credit?

Pay at least the minimum payment due each month, or more if you can, and make sure you pay on time.

What can a creditor NOT do?

threaten your credit rating or do anything to damage your credit reputation while you are neogoteating a billing dispute

How can you manage debt?

By controlling your impulses. use your moneyu responsibly, and use poor judgement.

advantages of using credit

1. enjoying services and goods,

2. combine purchases (making one monthly payment)

3. able to keep a record of your expenses

4. and also able to shop and travel.

disadvantages of using credit

1. can easily lose your credit reputation

2. may lose your income and property, which may be taken from you in order to repay your debts

what are the different types of credit cards?

1. store value (a gift card)

2. co-branding

3. smart cards

4. travel

5. entertainment

what is net income?

the income that you recieve (take-home pay, allowence,gift cards and intrest)

What does APR stand for?

Annual Percetnage Rate

the definition of APR is

the cost of credit on a yearly basis, but expressed as a percentage.