Building credit
How do you build credit?
A combination of purchasing a credit card, making payments on time, your payment history, and your length of credit history.
What is considered an “excellent“ credit score?
700+
What is a loan?
An agreement to borrow money with the promise to pay it back.
What percent of people use a bank?
95%
What is the difference between credit and debit card?
Credit is borrowing someone else’s money and paying it back.
Debit is using money from your own bank account.
Who is more likely to have a better credit score: A 40 year old or a 16 year old?
40 year old.
How can you improve credit score?
Making payments on time, having a longer credit history.
What is an example of a loan?
Student loan, auto loan, mortgage.
What are some things to look out for when choosing a bank?
- fees
-services
-reputation
-location
What are the pros of using a credit card?
You can get rewards, convenience, helps build credit score.
What does your credit score usually start out at?
500.
What is considered a “in serious need of help” credit score?
499 and below.
When is it a good idea to take out a loan?
When you know you’ll be able to eventually pay it back.
How does a bank operate?
Lends out other peoples money to each other in order to make a profit.
Why are some people more draw to using debit cards?
Because you are spending money you already have and can’t put you in debt.
Is a credit score of 750 impacted more or less by a missed payment than a score of 650.
750.
What percent of your credit score is made up of payment history?
35%
How do principle and interest change over time? Principle goes
Principle goes up and interest goes down.
What are some reputable banks?
-Chase
-Bank of America
-Wells Fargo
-US Bank
How old do you have to be to own a credit card?
18 without parent authorization, otherwise any age under your parent/ guardians account.
Who can look at credit scores?
Current or potential creditors.
What is Equifax?
Uses Equifax credit score scoring system. Score range from 280-850.
What is interest?
The “fee” a lender asks for in return for learning money.
What are some pros of putting money in the bank?
What percent of Americans have a credit card?
79%