Establishing Credit for Beginners

by Sara Seeger 20. September 2013

Credit Cards

 

 

 

 

 

Maintaining a strong credit history can be one of the most difficult lifetime challenges for people; especially young people just starting out. The paradox most people face is being able to establish credit without established credit! A good first step is to apply for a credit card with requirements that are easy to meet. Credit cards are useful financial tools and a great way to establish credit – but used improperly, they can be an easy way to rack up a lot of debt. Before you dive in to the world of credit cards, it’s important to understand credit-related terms, what they mean and how they help or hinder a person’s individual situation.

What is Credit?

Credit is referred to as a specific amount of money that is made available to be borrowed by an individual. Credit must be paid back to the lender (in this case, the bank) sometime in the future. In short, credit allows an individual to purchase goods or services without having to have “actual” money at the time of purchase. The amount of credit a bank will grant a person varies, depending on individual circumstances like credit history/score, existing debt (credit card balances, school and other types of loans, etc.) and reliable employment, to name a few.

Lesson: Establishing credit is necessary and should be handled as carefully as one’s reputation.

What is an Interest Rate?

An An interest rate is quite simply a fee paid by the credit card holder, for the privilege of borrowing money that would otherwise take time to accrue. Many banks offer an interest-free period for new credit card holders (usually 12 or 18 months) that give the borrower a bit of relief on the balance. After that time, interest will start to accrue on the credit card balance unless the balance is paid off in full every month.

Lesson: Look for promotional, interest-free offers, but keep the potential accumulation of interest costs top-of-mind, especially during this interest-free period, to avoid unpleasant surprises and unplanned expenses.

What Determines the Interest Rate on Your Credit Card?

Many banks have a range of interest rates that are assigned to a specific borrower. The primary factor banks use to determine the interest rate that is assigned to a credit card is an individual’s credit score. What’s in a number? Well, a lot, actually. A credit score tells the bank a lot about a person; for instance how much debt already exists, how timely payments are made, if the person has ever defaulted on an obligation or filed for bankruptcy, how much credit is available to the borrower already, etc. In simplistic terms, the lower the credit score, the higher the interest rate and vice-versa.

Lesson: The decision to default on a school loan or to make late payments on credit card balances or other financial obligations can haunt you for years. Think twice before you decide to take the trip to the Bahamas instead of taking care of financial obligations.

How do credit cards work?

A credit card is used as a form of payment and should NOT be thought of as free money. Each time a credit card is used, an individual is borrowing money, which must be repaid in the future. Most bank credit cards require only a minimum payment of the total balance to be paid monthly; however, unless there is an “interest free” period, interest will accumulate on the balance due.

Lesson: In order to obtain and maintain a strong credit profile, it is important to always pay credit card balances on time and to not over-extend credit limits.

Buying a home, purchasing a car, attending college, preparing for a wedding, and even taking a vacation may require credit. Establishing credit is necessary for most people and provides the flexibility needed to attain goals. The lesson to remember is that our actions and choices impact and shape our credit future.

If you found this article useful, be sure to check out these related articles:

Credit Scores: GPAs for Adults

True or False? Five Myths about Credit Scores Unveiled

Home Equity Loan or Home Equity Line of Credit?

Flacco Fridays: It's Back...

by Stacy Tharp 6. September 2013

Flacco Fridays

For the second year in a row, Team Flacco and 1st Mariner Bank are teaming up on Facebook to bring our fans Flacco Fridays - a series of weekly contests that will run throughout the course of the NFL season.

Week 1 of the season is here! So, what's the first contest?

Photo Search!

How does it work?
  • Each Friday, beginning, September 6, 2013, two photos of Joe Flacco will be posted on 1st Mariner Bank’s Facebook wall. At first glace, the photos will look identical...but look a little harder and you will notice FIVE differences between the two photos.
  • Participants must find the five differences between the two photos, then send 1st Mariner Bank a private, direct message on Facebook describing the five differences.
  • The fifth person to accurately describe the five differences wins!
When can you enter?
  • The photos of Joe will be posted on 1st Mariner Bank’s Facebook page beginning on Friday, September 6, 2013. You may begin submitting your entries as soon as the photos are posted.
  • Participants will have until the following Wednesday at 11:59 p.m. to enter.  (But remember, you must be the fifth person to correctly identify the five differences to win!)
  • The winner will be announced on 1st Mariner Bank’s Facebook page the following Friday before 5:00 p.m.
What can you win?

The fifth person to correctly identify the five differences between the photos via a direct message to 1st Mariner Bank on Facebook will win a piece of autographed Joe Flacco merchandise!

Click here to read the full terms and conditions.

Tip: If you “like” Joe Flacco’s and 1st Mariner Bank’s Facebook pages, you will get news feed alerts detailing information about each week’s contest over the course of the football season.

Good luck!

Joe Flacco Is Taking You Shopping & Other News

by Stacy Tharp 5. September 2013

Today's the day, folks! The 2013-2014 NFL season begins TONIGHT with none other than our Baltimore Ravens led by our favorite quarterback, Joe Flacco. How are we celebrating the season opener? Let us count the ways...

1st Mariner Billbaord

You may have already noticed 1st Mariner's digital billboards while driving around Charm City these past couple of days. The boards are currently rotating messages submitted by fans through our Facebook page. Each fan message selected is being featured for one hour on 6 digital billboards around the city of Baltimore. The messages will end around the start of tonight's game, but that doesn't mean the fun will end...

Oh yes, there's more!

Does anyone know what tomorrow is? Well it just so happens to be the kickoff to this year's Flacco Fridays series. For those of you who are new 1st Mariner fans, first of all, welcome to our blog and thanks for following us! Secondly, Flacco Fridays is a weekly contest series that runs throughout the course of the football season. Last year's contests included trivia, photo searches, and questions for Joe. Each week, one lucky winner is presented an autographed Joe Flacco photo.

Joe Flacco Visa® Debit Card

So what do we have in store for you this year? Hmm...I guess you'll have to follow us on Facebook to see!

And one final treat for our fans...

Joe Flacco may be just hours away from the Ravens' 2013-2014 season opener, but he's not too busy to go shopping with you - yes YOU. With our new Joe Flacco Visa® Debit Card you can keep Joe in your back pocket at all times. These cards come free with any 1st Mariner checking account, so stop into a branch or open an account online to get your Joe Flacco Visa® Debit Card.

Here's to a fantastic 2013-2014 season!



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