You want to buy something now but pay for most of it over time. You need somebody to lend you money in order to pay the seller now, and then you agree to make regular payments to pay amount borrowed back, plus interest.
To build your credit, you start by proving you can manage a small amount like a credit card with a small limit. Over time, by taking on more loans (additional credit cards, car loans, student loans) and paying them back on time, you’ll improve your credit score. This will allow you to borrow larger amounts and with lower interest rates.
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