The Difference Between American Credit Card Debt and Private Debt

In this essay I will discuss the differences between american credit card debt and private debt.

A credit card is a card similar to a debit card, you can use it to buy things without carrying cash with you. But if you spend more than the amount in your credit card account you have to pay back the credit card company the money you owe, and if you are late they will charge you interest, so you now owe the credit company the late fee(interest), and the money you originally owed.

Private debt on the other hand is non bank lending. This is where loans are not handed out by public markets, unlike credit cards. So, simply you borrow money from an individual person, not a bank. A way to get into private debt, is if you lend money to someone but did not have the money to do so, so the person that you lent money to goes between you and a person, bank, or company that you owe.

The difference between these two forms of debt are. Credit card debt deals with a bank, if you are late to pay back the loan, the bank will send you an extra fee ‘interest. Private debt does not deal with a bank.


My personal opinion on this topic is, make sure to have enough money to loan money or buy something. I think it is a much better idea to save up money to buy something or to give out loans. Don’t spend money that you don’t have.


  1. Beckwith407 says:

    Good essay.



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