Smart Credit Houston Community College Financial Literacy and Capabilities Module pt. 3

What is a Credit Card?

Credit Cards They are money you have to pay back They can help pay for necessities and emergencies. They can help you establish your credit history.

Tips for Managing Credit Cards Watch for changes in fees and interest rates Your credit score can affect your rates Avoid cards with annual fees Know grace periods and payment due dates Protect your card with signature and “see ID” Make more than just minimum payments Keep your balance under 35% of the limit Seek reputable counseling if in trouble Only use one general purpose credit card

Your Credit History is Credit Report + Credit Score = Credit History The three major credit bureaus in the United States are Experian, Equifax, and TransUnion.

Interesting fact: Cell phone bills aren’t included, but broken contracts and charge offs can appear.

What Does Your Credit Score Say?

Impact of FICO on Home Buying

Ways to Improve Your Credit Score Get a credit card, use it, and keep the balance low. Get a loan and repay it (biggest impact). Dispute old negative charges. Ask for a credit limit increase and do not use it. Fact: Credit repair companies can only legally dispute inaccurate information on a credit report, which you may do yourself for free.

Your Credit Report Things to consider… An employer can NOT get a copy of your credit report without your permission. You can get a free credit report if you have been denied credit or if you live in one of the five states with laws mandating annual free credit reports. Fact: If you marry, your credit report stays the same. The only information on both spouses’ reports is joint accounts or those for which one spouse is an authorized user.