Consumer Credit Notes. What is Credit?  Credit is PRIVILEDGE of using someone else’s money for a given period of time.  Debtor – Person who uses credit.

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Presentation transcript:

Consumer Credit Notes

What is Credit?  Credit is PRIVILEDGE of using someone else’s money for a given period of time.  Debtor – Person who uses credit or received the loan  Creditor – The company / person who sells the credit or funds the loan.  Credit involves legal documents and is based on trust.  Creditors will analyze the credit history of applicants prior to lending money.  Negative credit can mean denial or paying higher interest rates.  Credit is PRIVILEDGE of using someone else’s money for a given period of time.  Debtor – Person who uses credit or received the loan  Creditor – The company / person who sells the credit or funds the loan.  Credit involves legal documents and is based on trust.  Creditors will analyze the credit history of applicants prior to lending money.  Negative credit can mean denial or paying higher interest rates.

Types of Credit Cards  Bank Cards – MasterCard and Visa – may include annual fee  Charge Cards – American Express, Diners Club – no spending limit and must pay balance in full every month  Affinity Cards – Organizations, charities, sports teams, oil companies linked to a credit card and receive a percentage of sales  Retail Store Cards – retailers offer credit to their customers and the card can only be used at that store.  Bank Cards – MasterCard and Visa – may include annual fee  Charge Cards – American Express, Diners Club – no spending limit and must pay balance in full every month  Affinity Cards – Organizations, charities, sports teams, oil companies linked to a credit card and receive a percentage of sales  Retail Store Cards – retailers offer credit to their customers and the card can only be used at that store.

Assignment  Go to OWING. Read the advantages and disadvantages of credit and play the OWING games.  Create a FLYER in MS Word informing teenagers of the benefits and dangers of consumer credit. For each benefit and danger, describe the effect this has on individuals and businesses.  Your flyer should be attractive, colorful, professional and geared towards your target audience (teens). These will be saved to classes and some will be selected to be displayed in the hall.  DO NOT COPY AND PASTE!  Go to OWING. Read the advantages and disadvantages of credit and play the OWING games.  Create a FLYER in MS Word informing teenagers of the benefits and dangers of consumer credit. For each benefit and danger, describe the effect this has on individuals and businesses.  Your flyer should be attractive, colorful, professional and geared towards your target audience (teens). These will be saved to classes and some will be selected to be displayed in the hall.  DO NOT COPY AND PASTE!