Lending And Debt
Recently we have been learning about lending and debt, We learnt about 6 different types of payments. They were Credit Cards, Debit Cards, After Pay, Hire Purchase, Overdraft and Personal Loans.
Credit Cards: A Credit Card is a card when at the moment you pay you are using the banks money and you have to pay it back.
Debit Card: A card you can use to pay for things with your own money and you won’t have to pay it back to the bank, It is just like an eftpos card but you can also use it online.
After Pay: An After Pay is when you buy the item now and pay later, An easy way to say this is buy now pay later.
Hire Purchase: A Hire Purchase is a little bit like After Pay but you can buy more expensive things but get bigger interest rates.
Over Draft: An Overdraft is when you spend more money than you actually have, For example if you buy something that costs $50 but you only have $40 you will go into overdraft and have -$10 and the next time you get payed you might get $30 but the $10 of it will come out.
Personal Loan: A Personal Loan is when you get a loan from the bank but you have to pay it back.
Today we learnt about some more types of payments like bankruptcy, Interest Rate, Max Overdraft, And Unarranged Overdraft.
Max Overdraft: The maximum amount of money you are allowed to borrow.
Interest Rate:The rate which you are charged every week, This is a percentage of the overdraft balance every week.
Bankruptcy: Bankruptcy Is when you have no money left and cannot pay your debts.
Weekly Service Fee: A fee that you regularly pay to the bank for having an overdraft.
Unarranged Overdraft: When you spend more money than you have in your account.