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  • Digg it UP - What Is Credit and How Does It Work?

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    ting a debt that you are legally obligated to pay back. The most common types of credit transaction are loans and credit card purchases.

    How

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    Credit is a prettier word for debt. When you obtain credit you are borrowing money, or getting the right to access money (like a credit card, for example), and you agree to pay back the person or company that loaned you that money. In these type transactions, you are the "borrower" or "debtor" and the person or company who lent you the money is the "creditor". Part of the terms of the loan is the interest amount that you will pay for the right to use the creditor's money. Interest is simply money that you pay for the right to borrow money.

    When you make a credit transaction, you are creating a debt that you are legally obligated to pay back. The most common types of credit transaction are loans and credit card purchases.

    How

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    ple), and you agree to pay back the person or company that loaned you that money. In these type transactions, you are the "borrower" or "debtor" and the person or company who lent you the money is the "creditor". Part of the terms of the loan is the interest amount that you will pay for the right to use the creditor's money. Interest is simply money that you pay for the right to borrow money.

    When you make a credit transaction, you are creating a debt that you are legally obligated to pay back. The most common types of credit transaction are loans and credit card purchases.

    How

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    he person or company who lent you the money is the "creditor". Part of the terms of the loan is the interest amount that you will pay for the right to use the creditor's money. Interest is simply money that you pay for the right to borrow money.

    When you make a credit transaction, you are creating a debt that you are legally obligated to pay back. The most common types of credit transaction are loans and credit card purchases.

    How

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    use the creditor's money. Interest is simply money that you pay for the right to borrow money.

    When you make a credit transaction, you are creating a debt that you are legally obligated to pay back. The most common types of credit transaction are loans and credit card purchases.

    How

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    ting a debt that you are legally obligated to pay back. The most common types of credit transaction are loans and credit card purchases.

    How do creditors decide whether or not to lend me money?

    Creditors make decisions about whether or not to lend you money based, in part, upon a profile of your past credit performance that is kept in files that are maintained by companies known as "Credit Reporting Agencies" (CRA's) or "Credit Bureaus" (CB's).

    How do credit bureaus work?

    Before credit bureaus came into existence, most creditors kept individual records on their relationships with borrowers and did not share that information with anyone else. If you needed credit from a company that had no history of cr

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