key terms section 10.1 & 10.2 why should you be careful not to take on more debt than you can...
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Key Terms
Section 10.1 & 10.2
Why should you be careful not to take on more debt than you can easily repay?
*Credit*Equity*Creditworthiness*Character*Capacity*Capital*Credit History
Question to think about!
Section 10.1 & 10.2
Goals Health
Illness Off of work
Why Borrow?
Home Education
Section 10.1 & 10.2
Total debt payments excluding housing costs no more than 20-25%
of your take-home pay.
How Much Should I Borrow?
Character Capacity Capital
•Are you dependable?•Past borrowing•Stability of job•Pay bills on time
•Income sufficient to pay loan?•What other expenses do you have?
•Value of what you own -house -investments -savings
The Three Cs
Section 10.1 & 10.2
Quiz
Key Terms
Section 10.2 & 10.3
Why is a good credit rating so important?
*Credit Bureau*Credit Rating*Secured Loan*Collateral*Installment Loan*Unsecured Loan
Question to think about!
Section 10.2
Three largest TransUnion Equifax Experian
Credit Bureaus
Information comes from Stores Banks Utility companies Court records
What is on it? Bounced checks Missed a payment Been sued
Section 10.2Credit Report 1. Identifying
Information2. Credit History3. Collection
Agency Info4. Public Record
Info5. Inquiries
Section 10.2
Credit Rating
FICO Score•300-850
1. Payment History2. Current Debt3. Length of Credit
History4. New Accounts and
Inquires5. Type of Credit
Used
Who would you loan
to?
Key Terms
Section 10.3
Do you believe that your credit history could help or hinder you if you applied for a loan? In what ways?
*Regular Charge Accounts*Revolving Charge Accounts*Grace Period*Credit Limit
Question to think about!
Section 10.3
Regular Revolving Sources
Pay balance in full
•American Express•Diner’s Club•Some department stores
Carry a balance from one month
to another
VISAMasterCard
DiscoverMany more
Credit Cards
Credit Card Costs
Annual FeesInterest Limits
and Penalties
Credit Card Statement & Interest building credit worksheet!
Key Terms
Section 10.4 & 10.5
Why should all couples discuss money and credit before they get married?
*Finance Charge*APR*Acceleration Charge*Balloon Payment*Identity Theft*Debt Consolidation Loan*Bankruptcy
Question to think about!
Section 10.4 & 10.5
Truth in Lending Calculate costs the same
way Equality in Lending
Illegal to refuse credit based on race, religion, gender, marital status, age
Fair Credit Reporting Act Fair Credit Billing Act Fair Debt Collections
Practices Act
Credit RightsCredit
Responsibilities Accept Responsibility
Know Your Debt Capacity Credit and Family
Self-Control with Credit
Dave Ramsey and Study Guide