Introduction to Credit Credit is your proven ability or inability to make payments over time. Your Credit Score is a formula that banks use to predict the likelihood that you will miss a payment in the next year or over the term of the loan. Why Build Credit? The only reason in my opinion to build credit is to use credit to make money. Most people build credit to borrow money to spend. If you are borrowing to buy a depreciating asset like a car or boat or vacation you are probably going to dig yourself a Credit Hole. Another Definition of Credit Credit is the trust that allows one party to provide resources to another party where that second party does not reimburse the first party immediately, but instead arranges either to repay or return those resources (or other materials of equal value) at a later date. Credit is extended by a creditor, also known as a lender, to a debtor, also known as a borrower. Credit does not have to be in the form of money; it can also be in the form of go...