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Learning the fundamentals of what credit is and how it works is your first step

to financial empowerment.

Learning the fundamentals of what credit is and how it works is your first step to financial empowerment.

The Power of Credit

Credit is an incredibly useful financial tool that can be

used to help people achieve their financial goals.

With credit, you can borrow money at a low interest rate to purchase items or pay for services.

Credit also allows you to build a positive credit history if you use it responsibly, which can open up other financial opportunities like obtaining a loan or a lower interest rate on a loan.

It is important to be mindful of how much you borrow and to make sure you pay your bills on time. With a good credit score, you can take advantage of all of the benefits credit has to offer.

Why is Credit Important

Credit affects many aspects of your financial life.

It can help you get approved for loans, credit cards, and other financial products, as well as lower interest rates on the loans and credit cards.

It can also help you rent an apartment, get a job, and even get cheaper insurance rates.

Credit also helps you track your spending and financial behavior, so you can make more informed decisions about your finances.

The more responsible you are with your credit, the more financial opportunities you will have in the future.

The Power of Credit

Credit is an incredibly useful financial tool that can be

used to help people achieve their financial goals.

With credit, you can borrow money at a low interest rate to purchase items or pay for services.

Credit also allows you to build a positive credit history if you use it responsibly, which can open up other financial opportunities like obtaining a loan or a lower interest rate on a loan.

It is important to be mindful of how much you borrow and to make sure you pay your bills on time. With a good credit score, you can take advantage of all of the benefits credit has to offer.

Why is Credit Important

Credit affects many aspects of your financial life.

It can help you get approved for loans, credit cards, and other financial products, as well as lower interest rates on the loans and credit cards.

It can also help you rent an apartment, get a job, and even get cheaper insurance rates.

Credit also helps you track your spending and financial behavior, so you can make more informed decisions about your finances.

The more responsible you are with your credit, the more financial opportunities you will have in the future.

The Fundamentals

Credit is part of your financial power.

It helps you get the things you need now, like a loan for a car or a credit card, based on your promise to pay later.Working to improve your credit helps ensure you'll qualify for loans when you need them.

What is Credit?

Credit refers to your ability to borrow and pay back money.

You can build your credit over time by being responsible with the credit you have.
Good credit makes it easier for you to move toward your financial goals.

Types of Credit

There are many types of credit. The three most common types are installment loans, revolving credit and open credit.

Revolving Credit
Installment Credit
Open Credit

What is a Credit Score?

A credit score is a number from 300 to 850 that depicts a consumer’s creditworthiness.

There are three main credit bureaus: Equifax, Experian, and TransUnion. More Info.

A credit score plays a key role in a lender’s decision to offer credit.

The FICO scoring system is used by many financial institutions. More Info.

Factors considered in credit scoring include repayment history, types of loans, length of credit history, and an individual’s total debt.

One metric used in calculating a credit score is credit utilization—the percentage of available credit currently being used

It is not always advisable to close a credit account that is not being used, since doing so can lower a person’s credit score.

Your access to credit is dependent on your borrowing and payment history, which is reflected in your credit report.

Five Factors of a Credit Score

There are five factors that make up your credit score:

Length of History (10%)

A short history isn't a bad thing, if you show responsible credit management.

Types of Credit (10%)

Having a variety of credit types (mortgages, student loans, credit cards) could boost your score.

New Accounts (15%)

Too many new credit account inquiries can lower your score (multiple inquiries for the same auto or home loan will not).

Amount Owed (30%)

Keep the amount you owe under 30% of your limits, or it could hurt your score (even if you make the payments in full).

Payment History (35%)

Late payments lower your score, so make sure to pay your bills on time and never skip a payment.

What are Tradelines and

How Can They Help Me?

Tradelines are part of what makes the information on your credit report. Positive tradelines generally help you build credit, while negative tradelines can lower your credit score.

Tradelines help those that want to boost their credit score. This practice is sometimes called credit piggybacking and it’s 100% legal, protected by the Equal Credit Opportunity Act. Since the early 90s, millions of Americans have used credit piggybacking to obtain competitive financing for things we all need, like mortgages, car loans and education loans.

The only shortcut we have seen to building credit fast is

piggybacking credit via tradelines. Through credit piggybacking, you can benefit from someone else’s responsible credit management, by becoming an authorized user on an existing account.

Authorized Users do not receive the physical credit card or have the ability to use the credit line, but they do get the increased score and perfect payment history.

Authorized Users cannot use the credit card or make any changes to the credit account, and they do not have the responsibility to repay any balances that are owed.

5 Top Tips on Credit

Building a good credit score is important for obtaining loans or other types of financing.

A good credit score shows lenders that you are a responsible borrower and can be trusted to repay your debts.

Having a good credit score is also important for renting an apartment or getting a job.

Many employers and landlords check an individual’s credit score as part of their screening process.

Paying your bills on time is the best way to build a good credit score.

Paying your bills late or missing payments can have a negative impact on your credit score.

Checking your credit report regularly can help you spot errors or potential identity theft.

You can get your credit report for free once a year from each of the three major credit bureaus – Equifax, Experian, and TransUnion.

Keeping your credit utilization ratio low is another important factor in improving your credit score.

This ratio is calculated by dividing your total credit card debt by your total credit limit. It’s best to keep this ratio below 30%.