Credit Cards and Rental Agreements The ultimate test of close reading!
Charge Cards • You pay them off every month • If not, you get hit with a lot of interest and probably a ding on your credit • It’s a good way to start building credit, but you have to follow the agreement carefully • Definitely make your payments on time, and definitely stay well under your limit • https://www.americanexpress.com/us/content/cardmember-agreements/green.html
Credit Cards • You don’t have to pay them off every month • They usually have card companies on campus who offer you student cards; they don’t require you to have any established credit. The flip side is that they put a giant interest on any balance you carry over. • It’s a good way to start building credit, but– again– you have to follow the agreement carefully • Treat it like a charge card, otherwise it’s very, very, very easy to get yourself into a whole lot of debt (if you charge too much, you’ll get hit with a lot of interest; this builds up very quickly and gets harder and harder to pay off … and the credit card companies can increase your interest rates • https://www.capitalone.com/credit-cards/journey-student/?external_id=WWW_VK836_ZZZ_ONL-SE_ZZZGO_T_SEM2_ZZZZ_c_Zg_44b4f2df-7562-4345-bce6-a84fd20fc85c_171036542309_67960
Secured Cards • You don’t have to pay them off every month, but you pay into them first in order to set your credit limit • You can still build credit with these, so it’s a good way to start (and it’s a little harder to get yourself massively in debt) • If you don’t pay off your balance every month, the interest rate is extra high • https://citicards.citi.com/usc/Secured/MC/2017/Feb/external/default.htm?BTData=Bqv.B.gAB6f.J.Bp0.MX5c.OUg.j7H.BJ.udn.Bj.Cd.Gy.E&app=UNSOL&sc=1P5ZA2Q7&m=1CK2111111W&B=M&ID=3404&cmp=AFA~01~120201~CARDSACQ~CreditKarma&aff_placement_id=151917994&AID=12835964&PID=2569276&SID=15287510902&ProspectID=17550A7A17D04C648E45E8B60DC320D9
Credit Goals • A fixed APR • Higher credit limits (that you will never, ever touch), but not too high • Rewards (cash back, travel, Disney dollars, gift cards, etc) • No foreign transaction fees or annual fee • A good credit score from using your card wisely (which will help you later with things like rental agreements & car loans)
Start Small • To start, just use it for something you definitely know you can pay off in full (just your gas, or just your groceries, or just your coffee) • See what that looks like at the end of the month (you’ll be surprised how quickly it adds up) • Decide in advance what you’ll use a credit card for, and don’t waiver from that decision unless absolutely necessary (as in, you get a tire blowout and need a new tire immediately) • https://www.capitalone.com/financial-education/credit-and-loans/credit/using-credit-wisely/
Weird Credit Facts • Keep that first credit card open for forever, but stop using it the minute you start qualifying for better credit cards; it’ll show you have a long credit history and improve your credit score • Every now and then (twice a year?), let $10 carry over to the next month; you can afford to pay the interest on such a small amount and it will actually improve your credit by showing you can pay things off
Be Careful • You’re going to hear about that credit score many, many times in your life. It’s because it’s important. Don’t screw it up. • If you open a card and realize you made a mistake, then close it soon after… you’re screwing up your credit score. • If you decide to go on a shopping spree or go on a luxury vacation to Europe on your card ... you’re screwing up your credit score. • Most people get themselves into some credit card trouble at least once in their lives. If this turns out to be you, reevaluate your budget immediately and figure out how to pay it off. Then don’t make the same mistake again.
It’s Going to be Lost or Stolen • Don’t panic, but act immediately. • Call the company. This means storing the company’s phone number in your phone. • Tell them it’s lost, and they will cancel the card and send you a new one. • Tell them if you notice fraudulent charges (which means reviewing your bill every month)./Answer the phone when they call. • Save your receipts to check totals/tips (especially if there was a problem swiping your card). • Consider adding your parents to the card. (Hear me out/approach with caution.)
Rental Agreements • They can be month-to-month, in six-month increments, or annual. • Make sure everything is clearly stated in writing; it is a legally binding contract. • If you want to break the lease/move, the landlord doesn’t have to let you. • If you let someone move in with you who isn’t on the lease, you will be responsible for any damages they do to the place. • We’ll look at some. What are things you notice? Anything that seems like it might be tricky?
Rental Agreements • Before you sign anything, read through this: http://www.dca.ca.gov/publications/landlordbook/before-rent.shtml • If you find yourself with a problem, start by reading through these to check your rights and find where to get help: http://www.dca.ca.gov/publications/landlordbook/resolve-problems.shtml http://www.dca.ca.gov/publications/landlordbook/index.shtml
Rental Agreements • Make sure you understand all parts of your lease before signing. • Keep all correspondence between you and your landlord . (This makes email communication ideal!) • Keep proof of your rent payments and deposits. (Many rental agreements require you pay first month’s rent plus a security deposit, or even first and last month’s plus a security deposit in some states) – This is one of the reasons I still have a checkbook. It provides a record of payment.
Slight Departure • https://www.nsopw.gov/ • https://www.familywatchdog.us/ • Keep in mind that these people have served their time and paid for their crimes. However, some are listed as still being high risk. Ladies in particular, use this information wisely.