credit rating today you will... start down the path to build a reputation as a responsible borrower....
TRANSCRIPT
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating2
Credit Rating
TODAY YOU WILL . . .
START DOWN THE PATH TO BUILD
A REPUTATION AS A RESPONSIBLE
BORROWER.
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating3
Can I Borrow?
• What were you trying to borrow, and were you successful in negotiating a deal to borrow the item? Why or why not?
• What were the conditions (if any) for you to follow so you could borrow or use the item?
• When you were asked to loan the item, what influenced your decision to let the person borrow the item?
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating4
Preview
Today we will answer these questions:• How do I get a loan or credit card?
• Will I automatically get approved for a loan?
• Will one lender know about my other loans?
Use what you learn todayto impress lenders with good borrowing
habits.
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating5
Applying for Credit• Full, legal name
• Current address and phone number
• Date of birth and Social Security number
• Current employer
•Monthly income
• Bank name and account number
•Monthly rent or mortgage payment
• Christina L. Anderson
• [use your own address, phone number]
• May 29, 1963, (SS # provided)
• Mrs. Anderson is a physical therapist at Sargant Care Clinic, 400 Medical Way, [your town]
• Ms. Anderson started working at Sargant five years ago today and currently earns $5,100 per month.
• The Andersons have a savings account (#123-45-6789) at a bank near you
• Pay $975 per month for mortgage
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating6
You Make the Call
Approve or Deny a credit application?
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating7
Credit Reporting
A history of how you have used credit:• Where you live and work• Credit account amounts (balances and
limits)• Payment history (on time or late)• Recent inquiries from creditors• Any collection or legal action to collect
debt
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating8
Who’s Watching?
Credit-Reporting Agencies
EquifaxExperian
TransUnion
Credit Card
Providers,
Lenders,
Banks,
Landlords,
Employers,
Insurance
Companies
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating9
Starting Out
Ask someone to cosign on
the agreement.
Show evidence of steady
employment.
Use a checking account
responsibly; have money in
the bank.
Establish a relationship
with a bank or credit union.
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(C)2012 National Endowment for Financial Education | Lesson 2-3 Credit Rating10
Challenge Assignment
Devise a plan for action you can take now
to practice sensible borrowing habits
and to build a good reputation as a
borrower.
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