Credit seems to be very important these days. Gone are the days where people will save for what they want. Many people will take loans out, or use credit cards to acquire what they need or want. This could be a slippery slope though as credit cards, and loans can have high interest rates. With that said, there are two types of credits. There are your revolving credit (Credit Cards, and HELOCs), and loans (mortgages, and car loans). In either instance, there are regulations in place to reduce predatory practices.
Almost all loans will have an interest rate. This will be known as the base. For example, a home loan might have a base interest rate of 3%. A credit card might have a base interest rate of 20%. In either cases, the interest rate is adjusted based on the customer’s credit score. Information about this can be detailed in another page on this site. However, it will be required by law for the credit issuer to provide the base interest up front and to the forefront. This is done to reduce confusion, and make things clear and precise. Since the customer has access to their credit score, they can make a decision of if this is the right product for them.