What is credit? – The facility of a customer to receive goods or services before payment, based on the trust so payment will be made in the expectation. Banking obtaining power generate by banks through lending based on fractional reserve system. An agreement based extensively on trust under which goods, services or money is transfer against a promise to pay later. Also called credit card.
A small plastic card issued by a bank, building, office, society etc. approve by the owner to purchase goods or services on credit.
How do I use credit?
if you use credit, it uses means using a credit card. It means that you get a loan. A loan is a different way to use credit.
Using credit means you use the money to purchase something.
You use money (with your credit card or loan).
You purchase the thing you need.You will pay back that loan later – with interest.
What is interest?
Interest is what you pay for using somebody else’s money. You repay money to whenever gave you the credit or loan.
Credit cards and loans become different interest rates. Look for the “APR.” APR means yearly percentage rate. It is how much interest you will pay during a complete year.
A cheap interest rate means you will pay less money. A higher interest rate it means you will pay more money. For example, a loan with 3% interest rate costs less than a loan with a 14% interest rate.
When can I use credit?
Several people use a credit to purchase everyday things, items, product. You might use a credit card to pay for:
- Buy Clothes
- Buy groceries
- Phone bills
- Recharge Mobile
- Pay Electric Bill
- anywhere pay online
Loans usually are for more valuable things. You might get a loan for:
- Charity etc.
How do credit cards work?
If you use a credit, someone gives you money to purchase anything.
Here is how it works:
If You want to buy any product. You pay from a credit card from a bank. The bank pays the store or mall for your product. The bank will send you the credit card statement, including charges for the Product. You pay your credit card bill.
How do I get a credit card?
You requirement apply to get a credit card. The company you will apply to review your credit history or Records. The company uses your credit history to determine:
if you will get a card
how much you will pay with the card, Bank or Company decide how much limit your credit card
Before you apply for a card, be sure you compare to least Three or Four cards. if You want to get the genuine deal you can.
How do I compare credit cards?
Credit cards give different deals. if, Before you get a credit card then get out these things:
What is the yearly fee? whatever you pay to use the credit card for a year.
What is the APR? APR its means annual percentage rate. this costs you small money. This is how much interest you will pay every year. A cheap APR means you will pay small interest.
act beyond other fees? How much will you pay it to cost, if a payment hold late? how much will it cost if you work over your credit card limit?
What is the balance time? that is the time between if you use money and if credit card charges you interest. A longer balance time is better. Look for one that is at least maybe it 52 days long.
How should I use my credit card?
if you using your credit card is like take a loan. if you use your credit card to purchase something, you are using money.
Many people use a credit card to purchase things, Item, Products they can not afford right now. but Some people use a credit card to better build or improve theirs credit account. Sometimes it is just peaceful not to give cash. Sometimes it is peaceful to pay one month for the things, items, products you buy. You pay limited for your credit when you pay everything you owe/Levantine every period.
Should I pay the whole bill every month?
Every month you can pay your whole bill. its means you apparently will not pay interest. it makes credit less valuable for you. so you might not pay your whole bill every month. but you also pay some little bill. You pay only smallest payment. its means you might pay interest on the amount you did not pay again. That amount is called the balance which is in your card limit. A credit card is more valuable if you pay the minimum amount of payable and If you do not pay the minimum amount payable is also called the minimum payment:
- Your interest rate might high up
- Maybe you might become to pay fees
- Maybe your credit card will take you a lot of money