3. Finance Charge
Finance Charge—Total dollar cost of credit, including
interest and all other charges
Credit Companies may charge a finance charge to
make you aware of the total cost of credit
4. Interest Rate
Interest rates credit card companies usually charge is
12%.
It is dangerous to pay the minimal amount each
month because you are less likely to get your bill
payed
5. Common Credit Card Companies
Visa
Discover
American Express
MasterCard
6. Credit Rating
It is important to know your credit rating so you
know when you need to borrow money or when you
need to make a major purpose.
Good Score: High 700’s
Bad Score: 499 and below
You get your credit rating score checked when you
are trying to get a loan and/or applying for a job
7. Benefits of using a Credit Card
Convenience
Immediate Possession
Savings
Credit Rating
Useful for Emergencies
8. Problems concerned with Credit
Overbuying
Careless Buying
Higher Prices
Overuse of Credit
10. Credit Application
Form on which you provide information needed by a
lender to make a decision about granting credit
You often fill one out when you need a loan or are
applying for job
11. Truth in Lending Law and Fair Credit Billing Act
First of a series of credit protection laws
Requires that you be told the cost of credit before
signing an agreement
Fair Credit Billing Act—Law that gives consumers
the right to know what information credit bureaus
are giving to potential creditors, employers and
insurers.