Credit cards are a fantastic way of spreading the cost of a large purchase or being able to get yourself out of a financial jam quickly and efficiently. However, too many people do know enough about how credit works and this could be causing them a fortune. To that end, read the post below to top up your education on credit, something that will save you money. 
Credit Cards
Score vs rating 
Most people are aware that their reliability as a borrower is assessed, and it is this that is used by companies to decide whether to grant the further credit and loans. However what many folks don’t get is that there are two different systems. 
The first is the credit score and this a three digit number that is awarded to individuals and determines their risk as an investment. This is what you need to know about if you want to buy a car, get a mortgage, or take out a loan. You can find out how to check this at sites like or by following the advice in the video below.

The second form of assessment is the credit rating, and this is a mix of letters and numbers, and it is used for business and commercial enterprises. This is not the same as your credit score, and that is important to know if you are in the process of setting up a business. 
Rating vs rate 
Some of the terminology to do with credit can be confusing as well. In fact, there are two things that sound the same but are different. 
These are credit rating and credit rate. Credit rating is, as described in detail above, about your risk level as a business. However, a credit rate, often known as an interest rate is the percentage value of the entire amount you have borrowed that you can expect to pay back. Something you can get more detail on at
It is vital to know what the term credit rate means, as well as what the figure is because lower rates are preferable as they will cost you less in the long run.  
The problem with credit  
Now, linked to this concept of interest rate is the main problem with credit that many people don’t think about until it’s too late. 
How it works is that you buy something on credit with a high-interest rate. Unfortunately, because the interest is high, you end up paying only the minimum payment, and you don’t clear the original debt you borrowed. Therefore interest is keep being added to this and you end up in a cycle of debt
Happily, you can end this by working with a company like that can take on this debt for you. All you then need to do is pay them their monthly fee, and over the long term you can clear off the debt you owe. 
Credit applications 
Lastly, applying for credit can be a risky thing, but not many people realize why. The reason is that if you apply and are denied this is recorded on your credit record and affects your score. 
What this means is that if you want to keep your interest rate as low as possible only apply only four cards that you have a good chance of getting, and limit applications to a minimum.

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