LET'S TALK CREDIT, WOMAN TO WOMAN.
The Sequin Project is bringing together credit experts and a community of financially curious women (oh hey, that's you!). Get exclusive access to live events, credit pro-tips, and 1:1 coaching.
There are so many credit myths out there. Sequin's credit experts are here to help you get the facts straight.
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Credit Pro-Tips
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APR
Annual Percentage Rate
tl;dr
It is what makes credit card debt some of the most expensive money you’ll ever owe.
APR
Annual Percentage Rate (APR) is additional cost of borrowing money when you don’t pay your credit card bill off in full. Most credit cards charge interest that compounds daily, which means you pay interest on interest.
Pro-Tip: Pay your credit card statement in full every single month, to avoid paying high interest.
HARD INQUIRY
(also known as 'hard pull')
tl;dr
It shows up on your credit report and could impact your credit score.
HARD INQUIRY
A hard inquiry is when a lender “pulls” your credit report to make a lending decision. A soft inquiry, on the other hand, reviews your credit history at a high level but does not factor into a lending decision. A hard inquiry shows up on your credit report, a soft inquiry does not.
Pro-Tip: Check your credit score often via Credit Karma. It doesn’t affect your credit history.
CREDIT UTILIZATION
tl;dr
It's how much of your credit limit you are using.
CREDIT UTILIZATION
How much you’ve spent using credit / total credit limit approved across lenders. It is a key factor in determining your credit score. You want to keep your credit utilization below 30% at all times, and below 10% if possible.
Pro-Tip: Pay off big expenses even before your credit card payment is due.
AUTHORIZED USER
tl;dr
You are building credit history for someone else, and not under your own name.
AUTHORIZED USER
An authorized user is listed on another person's credit card but isn't legally responsible for paying the bill. Authorized users may not be building their own credit histories, which can hurt their chances of getting credit at favorable rates in the future.
Pro-Tip: Apply for a credit card in your own name, ASAP.
UNDERWRITING
tl;dr
It's the algorithm the bank uses to determine how creditworthy you are.
UNDERWRITING
The process banks use to determine the terms of your loan. For credit card issuers, underwriting may include inputs from your credit report, income, and current credit lines with their bank to determine your credit limit and interest rate.
Pro-Tip: Review your credit report and dispute any incorrect or suspicious activity.
MINIMUM PAYMENT
tl;dr
The least you can get away with paying on your credit card bill -- but will cost you.
MINIMUM PAYMENT
The minimum payment is the lowest amount of money that you are required to pay on your credit card statement each month to avoid a late fee. However, if you only pay the minimum, you incur high interest on the remaining balance, which may become difficult to pay off.
Pro-Tip: Pay as much of your credit card balance as you’re able – ideally all of it.
Credit Basics
What every woman needs to know about credit.
Sequin's Top Tips For Women Building Credit.
There are plenty of credit card blogs out there -- consider this your single source of (simple) truth.
Your Credit Score And What To Know As Women.
Women want to know, "what's behind my credit score?" Here's how we answered.
Credit Card Rejection Letters: Demystified.
We've been there: the dreaded credit rejection letter. What they mean, and advice for what to do next.
How Credit Cards Work: End-To-End.
What goes on behind the scenes when you apply for, swipe, and pay your bill on your credit card.
What We're Reading
What would it take to transform financial services to be more equitable for women? Here's a few things that would help.
Women Deserve More Credit.
Join The Movement.
