Mr. Page.  The amount of money available to be borrowed by an individual.

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Presentation transcript:

Mr. Page

 The amount of money available to be borrowed by an individual.

 An amount of money borrowed by one party from another.

 1. Can greatly expand your purchasing potential  2. Raises your standard of living  3. Emergency funds  4. Convenient  5. Safer

 Can greatly expand your purchasing potential

 Can enhance your standard of living

 Emergency product (not to be a replacement for emergency savings!)

 Convenient

 Safer

 1. It MAY cost more then cash purchases.  2. Finance charges (total dollar amount of all interest and fees)  3. You tie up future income (debt/income ratio)  4. Can lead to overspending  5. Tie up future freedom!

 It may cost more then cash purchases.

 Finance charges (total dollar amount of all interest and fees)

 Tie up future freedom and future income (Debt to income ratio)

 Can lead to overspending

 Character: a person’s honesty and reliability determined by their history of repaying bills on time. (reflected in your credit score)  Capital: an evaluation of a person’s net worth (assets-liabilities)  Capacity: the income a person has available to repay the loan determined by job longevity/income and having few other loans  Collateral: property which can be seized if a person does not repay the loan  Conditions: refers to the general state of the economy

 Character: a person’s honesty and reliability determined by their history of repaying bills on time.  Reflected in your credit score.

 Capital: an evaluation of a person’s net worth  Assets-liabilities

 Capacity: the income a person has available to repay the loan determined by job longevity/income and having few other loans

 Collateral: property which can be seized if a person does not repay the loan

 Conditions: refers to the general state of the economy

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