I’ve started volunteering as a personal finance educator, and a lot of the questions I get are about credit- here is some information for y’all!
I’m sure you have heard quite a bit about credit. Good credit, bad credit. But what exactly is credit?
Quick answer: “Credit” generally refers to your credit score, which is a number that grades you on how risky it may be to give you a loan.
Having good credit means that you are expected to be a responsible money borrower- you will probably pay your loans back in full and on time. Good credit is often rewarded with the ability to borrow more money and lower interest rates on loans (you REALLY want this, because of compound interest!)
Bad credit means you are considered a higher risk loan customer. It might be harder for you to get a loan, and your interest rates will probably be higher than someone with good credit.
So what is a credit score? A credit score is a number between 300 and 850. Seems…
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