Credit Cards Credit Cards Mr. Coronado Consumer Ed/C.A.H

Hist of Credit Cards in U.S.  In U.S. over 144 million Amer have credit cards (1.4 trillion)  55 Million pay bills on time  90 Million do not pay bills on time (Where profits are for CC cop.

Building Credit  Establish steady work record  Pay all bills promptly  Open checking account don’t bounce checks  Get a co-signer on a loan and pay back the loan as agreed.

Effects of Credit Score  Do you pay bills on time?  Have you used credit cards before?  How long have you been at your present job?  Do you have a job?

Consequences if don’t pay Credit Card.  What property do you own that can secure the loan? (Large T.V., Refrigerator, Furniture)  Savings account (Deducted)  Any investments (Stock Market)  If don’t pay cc, you are taking out a loan and it can be very expensive.

Responsibilities of Credit Cards  Borrow what you can pay  Read & Understand credit contract (APR, fines, penalties for being late)  Pay debts promptly  Notify creditor if can’t make payments  Report lost or stolen cc immediately  Never give card # over the phone, unless you initiated the call.

Credit Card vs Debit Cards  Used as open- ended accounts  May have credit limit (Max you can charge)  Purchases made with credit cards by banks charge merchants a transaction fee.  Debit Cards automatically deducts $ from checking accounts  No limit, (Fine if go over balance)

Legislation with Credit Cards  Fair Credit and Charge Card Disclosure Act in 1988  Credit Card Issuers must inform consumers –Annual % rate (APR) –How monthly fees are calculated –Cost of all fees such as membership, transaction, cash advance, –Grace Period

Where can you get Credit Cards  Can get from bank  Private companies (Capital One, Cingular, Home Depot)  Fill out application from mail