explain consumer credit discrimination and three types of consumer credit discrimination
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Answer:
Consumer credit is a way for people who spend money on products to get an advance on the money required to pay for the object. The most common example of consumer credit is a person using a credit card. He uses the credit card to pay for goods and services, then he repays the credit card company at a future date.
Noninstallment Credit
Noninstallment credit is either secured or unsecured, depending on the company offering the credit. This credit does not have monthly payments of a set figure, but instead is due all at once in a lump sum payment of the full amount owed. Noninstallment credit tends to be due in a short period of time, such as in a month.
Installment Closed-End Credit
Installment closed-end credit allows the consumer to receive a certain amount of credit to purchase one item or a few goods. One type of installment closed-end credit is a car loan. The car company offers the consumer credit to buy the car. The credit does not extend beyond the sales price of the car. In addition, the person pays the credit in installments over a period of time instead of paying it back in one lump sum.
Revolving Open-End Credit
Revolving open-end credit is the type of credit a consumer typically finds with a credit card. The consumer has a specified amount of credit she can use or not use at her leisure. Then, the consumer must pay off part of the credit she uses at the end of a period, normally a month. The credit does not close unless the company offering the credit closes the account. Since it usually does not close, this makes the credit revolving.