![]() Is it worth almost $1,000 more to have it now (furthermore, the retail price in 3 years will probably drop)? That is like going into a store that advertised "SALE-ADD 20% TO EVERY PURCHASE. If purchased on a credit card with a 12% annual percentage rate (APR) compounded daily, and with minimum monthly payments of $166 paid over three years, it winds up costing over $5,980. Here is an example: a new television flat-screen HDTV model retails for $5,000. Most business credit scores are ranked on a scale of 0 to 100, while business scores using the FICO Small Business Scoring Service (FICO SBSS) range from 0 to 300. If one calculated the true cost of goods bought on credit, one would have second thoughts about making the purchase in the first place. Many impulse purchases are made on credit with little thought given to how the debt will be repaid in the future. ![]() For example, as of this writing: The average borrower with a score of 620 can expect an APR of 5.084 for. One should never use credit to purchase things for which one will not be able to pay in the future. You can get a mortgage with this credit score, but you might have to pay more in interest. Credit abuse increases the cost of credit to everyone. One of the companies involved with the FICO score used to illustrate that breakdown with a bar that looked like this: Combining charts for more information In theory, using the information from those two tables, you could extrapolate that 7 have a score from 780 to 799 (and 5 have 600-619). Goods and services are provided on credit with the expectation that they will be paid for with money in the future. With VantageScore, scores range from 300 to 850 and the factors that go into calculating a score are determined on a scale from less influential to extremely influential. Someone with an 830 is 100 baddie-free, has uber low util, and has a long history under his/her belt. But for argument sake, lets say it does top at 850. Credit is extended with the faith that borrowers will repay the debt. First off, the FICO score advertises to 850, but in reality it varies by FICO version and CRA with caps into the 830s and 840s. While credit is very important to the economy, its abuse is harmful.
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