Borrow 101

Borrowing can bring a family the home of their dreams, college diplomas from the schools of choice, a ski house in Vermont, or any of the many dreams and goals we all have. But borrowing can also be disastrous. It can take away, or make unreachable, those very same  dreams and goals.

Which path a person or family follows depends on how careful and disciplined they are about credit and its use. There are actions you can take to keep your credit sound and those dreams and goals within reach.

Tri-Town Apple will stay on point for good credit discipline and sound borrowing practices. This post, our second in the “Borrow Category” (see Important Information About Credit Reports (FTC)will cover some of the basics for sound credit management from MyMoney.gov. To view this site go here.

“Borrow

“Sometimes it’s necessary to borrow for major purchases like an education a car, a house, or maybe even to meet unexpected expenses. Your ability to get a loan generally depends on your credit history, and that depends largely on your track record at repaying what you’ve borrowed in the past and paying your bills on time.  So, be careful to keep your credit history strong.

“Actions You Can Take

  • Track your borrowing habits.
  • Pay your bills on time.
  • When you need to borrow, be sure to plan, understand and shop around for a loan with a low Annual Percentage Rate (APR).
  • Learn about credit and how to use it effectively.
  • Pay attention to your credit history, as reflected by your credit score and on your credit report.

“Hints and Tips

  • Borrowing money is a way to purchase something now and pay for it over time. But, you usually pay “interest” when you borrow money. The longer you take to pay back the money you borrowed, the more you will pay in interest.
  • It pays to shop around to get the best deal on a loan. Compare loan terms from several lenders, and it’s okay to negotiate the terms.
  • When repaying a loan, it may be better to pay more than the minimum amount due each month, so you will have to pay less in interest over the life of the loan.
  • One of your most important aids when shopping for a loan is the APR – the Annual Percentage Rate. This is the total cost, including interest charges and fees, described as a yearly rate.
  • Paying your bills on time will help increase your credit score. Even if you fell into trouble with borrowing in the past, you can get on solid footing and rebuild your credit history by making regular payments as agreed.
  • You are entitled to a free copy of your credit report every 12 months from each of the three nationwide credit bureaus. Go to www.AnnualCreditReport.com or call toll free 1-877-322-8228 to order the free reports. Beware of imposter sites.”

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