CM - Understanding Credit Lesson

Understanding Credit

Good credit is a necessity in our economy today; therefore, it is imperative that you understand how it works and how it is obtained. Credit is essentially money that you borrow now and agree to pay back later with additional fees or interest. There are various types of credit which include revolving, installment, and single payment. These types of credit dictate how you must pay back what you borrow. So credit cards are just one aspect of credit used by millions of people around the world.

Because a credit card is a loan made to you by a financial institution, you should expect that there are certain responsibilities attached to the privilege of having a credit card. One expectation is not exceeding your account's credit threshold by borrowing or charging more than your credit limit.

When you are granted a credit card account, the card issuer is required to clearly explain the interest rate associated with the credit card so that you are aware of how much the loan will cost you over time.

 

Understanding Credit Presentation

View the presentation below to learn more.

 

 

Credit Management Self-Assessment

Review what you've learned in the activity below.

 

 

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