1. Warm Up 1.What is the difference between credit cards & debit cards? 2.How are both forms of money?

2. Forms of Credit PFL Unit 5.4 https://www.youtube.com/watch?v=EoyJ6lo6C1Q

3. I. What is Credit? A.Credit- loans, credit cards, any deferred payment: spending money you don’t have (borrowing) B.3 Cs Creditors look for: 1.Capability- ability to repay debt (do you have a job?) 2.Character- willingness to repay debts (do you have a good credit score?) 3.Collateral- property to secure a loan (House, land, car, investments) C.Interest-amount of money you pay yearly to be able to use the bank’s money.

4. Is Establishing Credit Necessary?  YES!!! In the 21 st century you need to establish credit if you want to do the following things…  Buy a Home  Buy a Car  Receive a good interest rate on a loan Having a good credit score shows lenders that you are reliable and will pay them back

5. C. Est. Good Credit  1. Credit Score : a number assigned to a person that lets lenders know your ability to pay back a loan

6.  2. To est. good credit you must start buying things using credit and pay that money back in a timely manner.  Helpful tips…  Have bills in your name  Always pay bills on time or earlier and try to pay more than the minimum payment  Keep a steady job  Don’t move often  Keep your debt low  Use your cards responsibly  Stick to a budget

7.  3. Credit Line : how much money is available for borrowing  4. Financing : borrowing money to pay for an item you will pay off over time  5. Debt : money that you owe someone (person/business/organization) else

8. II. Common Forms of Credit A.Credit Card -Form of revolving credit borrow money on an ongoing basis 1.Monthly payments based on interest rates* APR: the interest rate you pay on using the credit card. https://www.bankofamerica.com/credit- cards/education/what-is-apr.go 2. At minimum payments, takes a long time to get out of debt 3. Responsible consumers use credit cards only to establish good credit! 4. Check out the different fees you may incur with credit cards.  https://www.nerdwallet.com/blog/credit-cards/how-to-avoid-credit-card- fees-lis/ https://www.nerdwallet.com/blog/credit-cards/how-to-avoid-credit-card- fees-lis/

9.  a. Annual Percentage Rate (APR) : shows you how much your borrowing will cost you over a year.  (1). This can help you decide which credit card is best for you

10. B. Mortgage –money borrowed to buy a house 1.Usually requires a down payment of 10% or 20% 2.A monthly payment + interest on the principle (amount borrowed) is paid 3.Foreclosure -If you stop making payments, the bank takes away your house!

11.  C. Other Loans  Car loans – to purchase a car based on a set number of monthly payments  College loans –to pay for college today, which will be paid back after you graduate and get a job  Personal loans –Set amount of money for something other than a car, home or college

12. Close  What is the cartoonist’s opinion about borrowing money for college?

13. Credit Cards  http://www.calculatorweb.com/calculators/creditca rdpaycalc.shtml http://www.calculatorweb.com/calculators/creditca rdpaycalc.shtml

14. Protecting Entrepreneurs 1.Patent- exclusive right to sell a unique good or service http://www.youtube.com/watch?v=UHocZzq qud0 2.Franchise- contract that gives a single firm the right to sell its goods to others for a fee ex: McDonalds 3.Trademark -a brand name, symbol, image or words used to distinguish a product or service made by a company. 4.Copyright- intellectual rights to an artistic creation Books, music, film http://www.youtube.com/watch?v=InzDjH1-9Ns

15. Warm Up http://www.youtube. com/watch?v=InzDj H1-9Ns http://www.youtube. com/watch?v=InzDj H1-9Ns  Why does YouTube want to educate users about copyright infringement?  What are the penalties for infringing on someone else’s copyright? Are the penalties too severe or too lenient? Defend your answer

16. What is ‘capital’ in terms of qualifying for credit? A.machinery B.Income C.Training or education D.Willingness to pay back debt

17. What is the most likely reason collateral is important to lenders? A.It makes a borrower appear less credit worthy B.It will be given to the lender upon failure to repay the loan C.It guarantees the borrower has enough cash to repay the loan D.The lender can meet federal regulations

18. If you uploaded the new Eminem album onto Facebook to share with your friends you will have violated the laws protecting: 1.Franchises 2.Trademark 3.Patent 4.copyright

19. Check Writing  Write a check in the amount of $ 999.76  Payee: Piedmont Heating & Cooling  Date: April 7, 2014