bad debt examples and explaination

  • credit card debt
  • car loan
  • personal loan

if you borrow money for anything that goes DOWN in value , it is a bad debt . cars never appreciate in value ( some notable exceptions – collectible cars , antique value cars ) – they always go down , clothes , phones and anything purchased on credit cards always go down in value .

an example of good debt is home loan or mortgage

homes generally appreciate over time – due to various economic factors such as an increase in population

the percentage of home appreciation depends on a lot of factors like proximity to good schools , shopping , groceries , restaurants , etc

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