Credit - a simple breakdown
By definition credit is an arrangement made between a person and a company in which the person obtains goods, services, or money on the agreement to repay at a later time or date. Before you are lent the capital to make such purchases, the credit company will put in place various safeguards to ensure your repayment.
Safeguards
The safeguards used can and will come in different forms based on the type of credit you receive. One example would be the lender having right to repossess and sell property of yours in order to recover debt if you default. Other safeguards might be third party guarantees, and generally as a last resort, the creditor will take you to court.
