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48 Cards in this Set
- Front
- Back
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How many undergrads have at least 1 credit card? |
83% |
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How do credit cards pose risk? |
Pay high annual percentage rates |
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Credit score |
3 digit number generated by math algorith, designed to predict risk. Specifically if you will become dilinquent in your credit obligations |
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Credit |
Borrowed money |
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Good credit |
Over 700 |
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3 major credit bureaus |
Equifax, experian, transunion |
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Credit scores range from |
300-850 higher score =lower risk |
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Fico (fair Isaac company ) |
Credit scoring model, dominated Market, I've 90%institutions use fico A consumer has three fico scores each provided by major credit bureaus |
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What goes into a credit score? |
Data from your credit report goes into 5 major categories that make up a fico score 1. Payment history 2. Amounts owed 3. Length of credit history 4. Types of credit 5. New credit |
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Person demographic such as |
Race, income , employment does NOT affect the score |
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How to check credit score? |
Fed law madame consumers the right to a free credit report from each credit bureaus agency but not a free credit score |
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How many percent of undergrads have at least 1 credit card? |
83% Poses risk because they may have high apr |
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Apr |
Annual percentage rates are a yearly interest rate |
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What is credit ? |
Arrangement by which you borrow money to buy something of value now and repay the lender at later date |
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People do not |
Give you money or sell you products on a deferred payment basis for free |
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Interest compensates .. |
The creditor for the cost and risk of extending credit |
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Debt |
The amount you borrowed plus interest |
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Non installment credit |
Payment in full each month (American express) |
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Installment |
Set payment amount each month until payed in full |
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Revolving |
You can pay anywhere from the minimum to payment in full |
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Creditor |
Person who extends your credit (department stores, credit card issuers, companies ) |
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Debtors |
Recipients of credit who owe debt to creditor |
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Why do people use credit? |
1.enables you to make large purchase 2.convenience 3.keep track of spending 4. Rewards points 5.good credit score |
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What is your credit record |
History of credit use |
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Fcra |
Fair credit reporting act requires each reporting agency to provide you with a free copy of ya credit report |
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It is a good idea |
To apply for fora free copy of your credit |
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Credit score |
Number that reflects your credit record |
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Parents can |
Add a child to their own credit card as an authorized user on the account . Parent is responsible |
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After a person turns 18 |
U can apply for a secured card instead of a credit |
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Secured card |
It's like a debit card, can only run up charges that are covered in savings |
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Lower apr |
The less interest you will pay |
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Some credit cards will increase apr |
If you make late payments |
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Grace period |
You will pay no interest on what you borrows for 20 days or more after you charge it, if you pay it off in those days you probably won't pay any interest |
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Many cards also charge an annual fee of |
Up to 75$ |
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If you can't pay your credit card bills.. |
1. May increase interest 2. Levy penalty fees 3. Cancel ur card 4. Seize tour property |
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Also if you can't pay your bills |
Approach your creditor and try to reduce your monthly payments without having to pay a penalty |
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Bankruptcy |
A legal process through which people and business's can seek t obtain a fresh start when they are in such financial difficulty that they cannot repay their debts |
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How to avoid id theft |
1. Guard your personal info 2. Shop carefully /use secure sites (https) 3. Keep track of finances |
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How to avoid getting into deep debt |
1. Take credit seriously 2.map out a budget 3.save 4.dont take on more cedit than you can handle 5. Use credit cards sparingly 6. Avoid cash advances |
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You can NEVER |
Get out of student loans even if you file for bankruptcy |
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Cosign |
Garunteed payment |
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Security |
Anything given in value to promise a payment |
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9/10 credit card balances |
Are not paid off in a month |
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16% |
Of student debt of from credit cards out of 20,402$ |
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Three c's |
Character, capacity , capital.... basic criteria lenders use them to determine if you are credit worthy and can be trusted to repay a loan |
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How can identify theft occur |
Hacking ,spamming, dumpster diving, shoulder surfing |
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What groups might use your credit score? |
Lenders,landlords,employers |
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Interesr |
Payment for the cost of risk |
