Instructor and student introductions.

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Introduction

• Instructor and student introductions.
• Module overview.

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Student Introductions

• Your name.
• Your expectations, questions and concerns about
  credit cards.

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Purpose

• Charge It Right will teach you about credit cards
  and how to use them responsibly.

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Objectives

• By the end of this course, you will be able to
• Describe the purpose of credit cards.
• Determine which credit card is best for you.
• Identify the factors creditors look for when
  making credit decisions.

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Objectives (Continued)

• Describe how to use a credit card responsibly.
• Identify the steps to take when a credit card is
  lost or stolen.

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Agenda and Ground Rules

• 90 minutes long
• One 10-minute break
• Training methods
• Classroom participation

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Credit Cards

• Credit cards
• Are a convenient form of borrowing.
• Give you a revolving line of credit.
• Require a minimum payment each month.

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Other Cards

• Cash cards
• Smart cards
• Stored value cards

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Secured and Unsecured Cards

• You do not have to provide collateral in order
  to get a credit card.
• A credit card is an unsecured loan.
• You can get a secured credit card if you have
  no credit history or a negative credit history.

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Gold and Platinum Cards

• These cards
• Have a higher credit limit.
• Require good credit history and higher income.
• May not have favorable terms.

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Reward Cards

• These cards
• Are offered by hotels and airlines.
• Charge an annual fee.
• May give you cash rebates

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Pre-approved Card Offers

• Credit card companies look at your credit report
  and determine that you MIGHT qualify for the
  interest rates and credit limit being offered.
• Whether or not you get the best terms depends on
  your income, employment, and credit history.
• Shop for the best terms.

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Credit Card Terms
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Annual Percentage Rate

• Interest rate fees APR, expressed as a yearly
  percentage rate
• APRs are either fixed or variable.
• Penalty APRs are about 52 percent higher than
  regular APRs.
• Credit card companies must state how long
  introductory APRs last.

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Fees

• Annual fees
• Late fees
• Over-the-limit fees
• Balance transfer fees
• Cash advance fees

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Grace Period

• The number of days you have to pay your balance
  before the credit card company starts charging
  interest.

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Balance Computation Method

• The balance computation method will determine how
  your interest is calculated.
• The most common method used is the average daily
  balance.

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Cash Advance

• The ability to get cash from your credit card.
• Credit card companies charge a fee for this
  service.
• Example 2/10
• The cash advance fee is 2 percent of the cash
  advance amount or 10, whichever is greater.

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Balance Transfer

• Balance transfer is the process of moving unpaid
  credit card debt from one credit card to another.
  
• Credit card companies sometimes offer low rates
  to encourage balance transfers coming in.

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Other Factors to Consider

• Customer service
• Additional protection

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Application Requirements

• Individual credit based on the assets, income,
  and credit history of the individual
• Joint credit based on the assets, income, and
  credit history of both people who apply.
• Age requirement 18 years old

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Credit Report

• A credit report is a record of how you have paid
  your debts. It tells lenders
• Who you are.
• How much debt you have.
• Whether you have made payments on time.

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Credit Report (Continued)

• Whether there is negative information about you
  in public records.
• Inquiries made about you.

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Credit Reporting Agencies

• Equifax
• Experian
• TransUnion

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Credit Score

• The credit score
• A number that predicts how much of a credit
  risk you will be.
• Calculated based on information in your credit
  report.
• Check your credit score before applying for new
  credit.

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FICO Score

• Scores range from about 300 to 900.
• Takes into account
• Past payment history 35 percent
• Outstanding debt 30 percent
• How long you've had credit 15 percent
• New applications for credit 10 percent
• Types of credit 10 percent

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VantageScore

• Was introduced in March of 2006.
• 3 credit reporting agencies use the same scoring
  system.
• Scores range from 501 990.
• A, B, C, D, F

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Denial Notice

• Lists the reasons for denying credit, such as
• You have a bad credit history.
• You have not been at your current address or job
  long enough.
• Your income does not meet the creditors
  criteria.
• Also called an adverse action notice.

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Lost or Stolen Credit Card

• Be careful giving personal information over the
  telephone or on the Internet.
• Immediately notify your credit card company if
  your card is lost or stolen.
• If you think you are a victim of credit card
  fraud, immediately contact your credit card
  issuer.

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Credit Limit

• This is the maximum amount of money the credit
  card company is loaning you.
• If you go beyond this limit, the credit card
  company will assess an over-the-limit fee.

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Cost of Making the Minimum Payment

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Benefit of Making More Than the Minimum Payment
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Benefit of Making More Than the Minimum Payment
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Credit Card Statement

• The front of the statement lists detailed
  activity during the account billing cycle.
• The reverse side describes some basic terms of
  your credit card agreement, including how the
  interest is calculated and where to call with
  billing questions.