What is your credit score? A community empowerment program brought to you by MasterCard

What is your credit score? A community empowerment program brought to you by MasterCard

Understand what a credit score is so you can make sure you re making smart decisions right from the start. 2

Master Your Card is a community empowerment program that helps you get the most from your money through prepaid, credit and debit cards. 3

Mastercard is a technology company that builds safe, smart and simple solutions for making payments and purchases. 4

Your credit, your future

What s a credit rating and why do I always hear people talking about it? 6

A credit rating or credit score is what lenders, banks, landlords and others use to evaluate your financial strength. 7

Credit scores change over time, ranging from about 300 to more than 850. 300 850 8

A number of things influence your credit score. 9

15% Credit history length 10% Types of credit used 30% Amounts owed 10% New credit 35% Payment history A number of things influence your credit score. 10

EXCELLENT 740-850 Higher scores will save you money. The higher the score, the lower the interest rate you will pay. GOOD 620-740 Improve your score by paying your bills on time and keeping your balances low. POOR 300-620 Financial institutions consider you a greater risk. You may not be approved for a loan at all. 11

EXCELLENT Higher score=lower rates as low as 28.9% 7.9% as high as POOR Lower score=higher rates 12

EXCELLENT Higher score=lower rates as low as 18.9% 5.1% as high as POOR Lower score=higher rates 13

EXCELLENT Higher score=lower rates as low as 9.5% 3.9% as high as POOR Lower score=higher rates 14

Typical $160,000 loan with a 30-year fixed mortgage Typical 5-year auto loan of $25,000 Credit card rates may vary due to different factors Credit scores offer lenders an idea of how much risk you might pose EXCELLENT 740-850 3.9% APPROXIMATE 5.1% APPROXIMATE 8.0% APPROXIMATE Higher scores will save you money. The higher the score, the lower the interest rate you will pay. GOOD 620-740 4.6% APPROXIMATE 8.8% APPROXIMATE 13.1% APPROXIMATE Improve your score by paying your bills on time and keeping your balances low. POOR 300-620 9.1% APPROXIMATE 18.4% APPROXIMATE 24.4% APPROXIMATE Financial institutions consider you a greater risk. You may not be approved for a loan at all. 15

Good credit opens doors

Follow these simple rules for a high credit score and a low-stress financial future. 17

Pay your bills on time. Pay off monthly balances in full. Know your credit limit and don t go over it. Do Keep your monthly balance low. Pay off debt rather than move it around. Read the fine print to know about fees and how to avoid them. Use your phone to monitor your balance. Review your credit report regularly with free annual reports, and dispute any inaccuracies right away. Report lost or stolen cards right away. Take advantage of special products and tools. Set smart spending limits you can tell the bank what your max limit should be. 18

Don t close unused credit cards. Don t Don t open multiple accounts in a short period of time. Don t let someone else in the family open up a card in your name. 19

But more than anything, 20

borrow only what you can repay! 21

Thank you

To get the most value from electronic payments, visit www.masteryourcardusa.org