Independent Living November 30, 2015

Credit: the use of someone else’s money, borrowed now with the agreement to repay later Originally used in the United States when the country dropped trading and created currency (Industrial Revolution) Earliest form (still used today): book credit Buyer creates account with business, puts amount due on account, pays off later

Used for all kinds of goods and services Goods: either nondurable or durable Services: something provided to someone for exchange of money Offered by banks, stores, and credit card companies

Creditors will charge money for this service Creditor Debt Debtor

Must prove you have the ability to repay the loan Creditors will look at the following: Income Financial Position Collateral

Must prove you have the ability to repay the loan Creditors will look at the following: Income Financial Position Collateral