Credit 101Education

What is Credit?

When we refer to credit, we are referring to the ability to receive goods or services upfront and be entrusted to pay for them later. Credit is used when we do not have the cash or aren’t willing to part with our cash for the purchase of goods or services.  Credit can be acquired in the form of mortgage, financing for vehicles, loans for starting businesses, lease for apartment rentals, and even charge cards for everyday purchases.

Interest charges can almost always be expected when receiving credit terms. The terms that you receive can allow for payment to be made in one or multiple installments with interest rates based upon your level of creditworthiness. Your credit score is a scale that lenders use to gauge this level of worthiness or in other words, how much money a lender should trust you to pay. This can also be viewed as the level of risk that the lender is liable to take. Various factors go into this score which is described in this next article

One main reason many people struggle with maintaining a good credit score is due to mismanagement of credit. It’s easy to get use to not having to pay full price up front and this leads to the abuse of the credit resources. We start charging all our wants and needs to credit and, in the process, overestimate our ability to repay within the terms agreed upon. Other times, we may experience abrupt changes to our source of income which hinders the ability to pay down credit. Good credit can be used to help sustain us in times like these and bad credit can make matters worse.

The lower your credit score is, the lower your worthiness for credit terms will be. The higher the credit score, the more financial resources are accessible to you. Your credit score can affect your ability to stabilize your future and can become a detriment to your lively hood. Learning how your credit score is calculated and using that knowledge to effectively manage your credit record is a huge step toward your dream lifestyle. No credit is considered too bad to fix. LaCrosse Management Services has a wealth of knowledge and can bring a 200 credit score up to 640 and beyond. With a clear plan and persistence, your credit can be repaired and revitalized.