BRESEE BANK

OF LOANS AND OTHER EVILS…

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Oh Yes You Can Borrow Points

You WORK HARDER for the SAME STUFF

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Don’t Do It

Gotta Get Some Points???Why borrow? Magic Mountain-leaving now…Xbox? Chips soda hot dog…

 

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You Work Harder for Your Stuff

Borrow to go to Magic Mountain 1,500 points

Pay on time -- One year later

You Pay Bresee 121 points in interest

Still owe 974 points loaned

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What Else Could You Have Done?

With the 121121 points?

Work less?

Food

Fun

Save

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Cost of Borrowed StuffYou Borrow You Pay

3 Yrs. 5 Yrs. 10 Yrs. $1,000 $1,772 $2,594 $6,727

$5,000 $8,858 $12,969 $33,637

$10,000 $17,716 $25,937 $67,275

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Gotta Get Cash --- FOR WHAT?

Car???Car???Shelter???Shelter???Fun???Fun???

Food???Food???

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Rules for When to Borrow

Ssshhhhhh

There are no rules

You decide – get now pay more later?

Save and pay cash – spend less later?

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Buy Stuff That Goes Up OK one rule….OK one rule….Buy stuff that goes upBuy stuff that goes up

House?

Stock?

Antique car?

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You Borrow to Get the Goods..

You put up half $250Borrow half $250

Pay interest

$ 50

$500 for SIGNED Collector Edition -

Snoop Doggy Dog’s Masterpiece -

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Two Years Later…

You get $1,500

You paid $ 500

Wooo --- not bad

You Make 200% $1,000

Snoop’s Goods Go Up..You Sell

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Pay Back TimeBut Wait – You Have to Repay the Loan

You Got $1,500Pay Back Loan $250Paid Interest $50

You Pocket $1,200

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You Make MoreYou Make Money on Other People’s Money…

You paid $250 (plus $50 interest)You made $1,200

Borrowing gives you an extra $200

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How Did You Make More?

You made money

on borrowed money…

But only when thingsgo up…

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Borrow for Car ?????? 

You NEEDNEED a NEW Ford Expedition

Dealer charges $40,000You Borrow $30,000

You Pay Bank $6,000 Interest

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You WANTYou WANT a NEW Car

YOU LOSEYOU LOSE $23,000Dealer will give you $17,000

Whoa - You paid $40,000

Two Years Later

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You paid interest $6,000You still owe $21,000

Your Expedition is worth $17,000

Pay the banker $4,000 just to sell

the car

You LOSE AgainYou borrowed $30,000

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When to Borrow????

Depreciate….Depreciate….

Or Appreciate….Or Appreciate….

OKOK to borrow to make to borrow to make money….money….

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OK to borrow to get to great new job?OK to borrow to get to great new job?

How much interest do you want to pay?

TRADEOFFS…TRADEOFFS…And And CHOICES…CHOICES…•Big car little car..

•New car older car…

You NEED a Car…

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JOB Pays…$20,000Pay interest of $3,000 per year???

$50,000 Pay interest of $3,000 per year???

$1 million Pay interest of $3,000 per year???

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Credit cardsCredit cards20%20%

Auto loan Auto loan 10%10%

House mortgageHouse mortgage 7%7%

Ways toto Borrow…

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They Can Take the Stuff Away…

CREDIT CARDS 20% NO!!CAR LOAN 10% Yes -

but the price goes downHOUSE LOAN 7% Yes -

but the price goes up

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Credit CardsNot wise choices:

• • ClothesClothes• • Eating OutEating Out• • MoviesMovies

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Credit Cards Wise Choices:

Car RentalBuying OnlineTracking ExpendituresLoss Limited to $50 if Stolen

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If use a credit card – only do if you If use a credit card – only do if you can pay off every month.can pay off every month.

Wise Choices

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$2,000 with 20% interest

2% minimum payment = 265 Months 22Years = $4,800 Interest

4% every month = 88 months

7 years = $1,120 Interest

Pay More Each Month!!!!

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So You Want to Borrow Points

Are You Good for It?

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BRESEE BORROWING BASICSBASICS1) Attendance- homework lab or computer lab min. 1 hour per week plus one regular weekly activity  2) Grades- min. 2.0 grade point average3) Point History- min. 50 points week4) Behavior- no more than 2 suspensions at

the youth center within past 3 months

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Bresee Lending Standards

Good credit= 1500 maximum at lower interest

Medium credit = 1000 maximum at

more interest

Bad credit = 500 maximum at

YIKES!!!

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30 days after you borrow points, every time you deposit

a check at the bank

25% will automatically go towards

your credit account 

Payback

PLUS INTEREST

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Tracking Your Credit35% -- your payment history

30% -- your outstanding debt15% -- length of time you've had credit10% -- number of inquiries on your report 10% -- types of credit you have

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Bad Credit ??–No Apartment!! No Job!!

300 scorescore --- ---

900 scorescore --- --- Bankers run afterBankers run after

you to lend you moneyyou to lend you money

  

Pay big costsPay big costs

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Not Trustworthy?

You pay more for $10,000 loanYou pay more for $10,000 loan

Rate Pay to Bank

Good credit 5.5% $13,100

Medium credit 7.5% $14,500

Bad credit 9.5% $16,000

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Stand in Good CreditStand in Good CreditDo you want to:Do you want to:

Pay $3,100Pay $3,100

Pay $4,500Pay $4,500

Pay $6,000Pay $6,000

Anything else you could think to Anything else you could think to

spend that money on? Of course spend that money on? Of course

your banker loves you…your banker loves you…

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SCAMS to Get Your Money

• • Payroll loansPayroll loans

• • Tax refund loansTax refund loans

• • Loan sharksLoan sharks

• • Leasing v buyingLeasing v buying

• • Predatory home equity loansPredatory home equity loans

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TRADEOFFS and CHOICES

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Spend than you make

Borrow borrow

less

smart cheap

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Pay Yourself First

SAVING MONEY!!

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