Establishing and Maintaining Credit

Image of young man with a credit score.Creditors make most of their money by lending out money and charging borrowers interest. If a borrower never repays the debt, the lender may lose all of the money they lent. Lenders have to be able to determine who is most likely to repay a debt as well as who is least likely. They also need to rate where everyone else who applies for credit falls in between these two extremes. Being able to accurately identify who won't pay back a loan can be the difference of whether the lender is profitable, or loses money. Lenders use credit scores to rate borrowers on the likelihood that they will repay a debt. Higher scores indicate borrowers that are more likely to pay their debts, while those with lower scores are judged as less likely.

Credit scores have large implications for whether you'll be able to borrow money as well as how much you'll pay in interest. They may have an impact on whether you'll be hired for some jobs.

What's in a Credit Score?

Establishing and Maintaining Credit InteractivityWhat goes into a credit score? What is considered a good credit score? How can you establish credit? Why is it important? Watch this presentation to learn about the characteristics lenders look for when deciding whether or not to lend to someone, the laws that protect you as a consumer from unscrupulous creditors, and how to maintain a good credit rating.

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Consumer Protection Laws

Consumer Protection Laws InteractivityAs a consumer, you have certain rights that protect you from unfair lending practices. In this interactivity, you will discover various consumer protection laws. Click the player button to begin.

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