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FINANCE
The Finance Section explains one of the most important aspects of success: managing your money. The sometimes confusing aspects of credit and loans are made easy to understand. This section shows how to get a credit card, establish good credit history and apply for a loan or mortgage.
What is Credit?
Credit is the process in which a company or group loans money to an individual. The individual takes on debt and must pay back the lender in installments. The individual must pay back the amount he or she borrowed, plus interest, or a fee for borrowing money, which usually increases with the amount of time it takes to pay back the loan. Credit in America is a normal part of financial life, and is usually essential for large investments, such as a car or house.
Credit Bureaus are organizations that collect information about an individual's purchases and payments with credit. For each person, these organizations create a credit history, sometimes called a credit report or simply a person's credit. Once you use a credit card, make a loan or obtain insurance, your credit profile is established. Then, lenders can view your credit history and use the information to determine whether or not they will lend you money. This credit history, based on how readily you make your payments, how much debt you take on, and how stable your lifestyle appears, is very important, as it will greatly affect your ability to get loans, credit cards and insurance.
Credit Report Inquiries
If you are interested in how your credit history looks and what your credit score is, you can obtain a credit report. There are three major consumer reporting agencies in the US - Equifax, Experian, and TransUnion - from which you can obtain your credit report. Under a new law, consumers can obtain one free credit report per year from these companies through www.annualcreditreport.com, but all other requests demand a fee. Many other companies offer credit reports as well, often for a lesser or no fee.
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