Borrowing and Credit

1
Borrowing and Credit
2
Borrowing money

• Transfer of a specified amount from a lender to a
  borrower for a specified length of time
• Finance
• Get what you need when you need it

3
Borrowing money

• Principal-amount borrowed
• Interest extra paid
• Collateral
• Equal payments, installments

4
Credit

• VISA
• MC
• American Express
• Credit rating probability of repayment
• Ability to pay, assets and credit history
• Credit bureau

5
Credit terms

• Billed every 28-30 days
• Credit limits
• Dont pay full balance, finance charge
• Total cost of credit in dollars and cents
• APR yearly percentage, 18 or 1.5 a month
• Services charges
• Usury setting above legal limit
• Bankruptcy

6
Credit and economy

• Simulating growth
• Promoting stability
• Demand decreases as consumers buy