Build credit without credit cards?

[Jekblad]

here's the disconnect for me:

your only going to buy things you can pay for (say by next pay period, or in a little bit). Now you've $250,000 line of credit that you'll never use. Unless you have 250 large next pay period.

So whats the point? to be approved on a house or car?

[ChiDJ]

here's the disconnect for me:

your only going to buy things you can pay for (say by next pay period, or in a little bit). Now you've $250,000 line of credit that you'll never use. Unless you have 250 large next pay period.

So whats the point? to be approved on a house or car?

Yes, that is the point. By having a good credit rating, you qualify for the lowest interest rate possible on a house or a car.

Word of advice, buy a house then pay your car off in cash with your home equity line of credit. That way your car loan is tax deductible and you just created better credit with the car dealer.

[Jekblad]

Gotcha.

We went through the whole mortgage crisis experience.
Our FHA loan approved for 500,000. We bought a 160,000 duplex type thing. they're now worth 70,000 ish. Short sale on ours went for 73,000 or something. Long story short, not interested in a mortgage for a while, would rather rent and stay flexible for a bit.

We have one car but are looking to buy a used one in cash at some point. I imagine our credit will be back to acceptable by the time we go to buy our next house.

[ChiDJ]

Gotcha.

We went through the whole mortgage crisis experience.
Our FHA loan approved for 500,000. We bought a 160,000 duplex type thing. they're now worth 70,000 ish. Short sale on ours went for 73,000 or something. Long story short, not interested in a mortgage for a while, would rather rent and stay flexible for a bit.

We have one car but are looking to buy a used one in cash at some point. I imagine our credit will be back to acceptable by the time we go to buy our next house.

Yeah, I feel you, I owe more than 100% over what I paid for my house in '95. That's due to dirty cunt bizness. It's still worth a little more than what I owe, but, i don't plan on leaving anyway.

It sounds like you get it. Just don't ever put your self in a position that will make you pay more than 2-4% interest unless it's tax deductible. Otherwise your are a slave.

Be wise. Be wealthy. Be sexy!

Tod

[Jekblad]

Be wise. Be wealthy. Be sexy!

Tod

this for sure

[Bleep Blop Ima Robot]

Just get as many credit cards as you can, buy anything and everything your heart desires, max those bitches. The world is going to shit anyway, debt will be the least of our worries

[Jekblad]

i love how your sig makes your point. rock it!

[LoopStationZebra]

There was a great segment on NPR last weekend about credit - and a guy who's mission was to get the perfect credit score of 800 (which is next to impossible to do, btw).

The advice he had was right on. The most impressive and bestest thing to do to build good credit is making on-time payments consistently over a period of time. 6mon to a year will do nicely. The amount or type of card doesn't much matter. Consistent payment doesn't mean you make a big ass purchase and then pay it off right away - then don't use your card again for months. The best way is modest purchases and pay those off within the usual 30 day period to avoid interest kicking in. Do this on just one card for a year, and you'll have at least a score of 700.

The guy with the platinum card making $10,000 a month purchases and making his payments on time isn't going to get any better of a score than the dude making $100 a month purchases.

It's all about on time payments.

But just one card will only get you so far. Serious credit ratings are built with more than one card. Excellent ratings are only achieved via other purchases such as mortgage or auto loans. Diversity counts for a lot.

[Pitch Black]

So far everyone is talking around credit cards.

Buy something you actually need and can afford to buy - a fridge, a piece of music gear, on Hire Purchase and set up an automatic payment to pay it off on time every month. You could buy a few small bits of gear, or small appliances, on separate contracts from different retailers, and as long as you pay them off correctly you will build a good credit rating.

[beats me]

But just one card will only get you so far. Serious credit ratings are built with more than one card. Excellent ratings are only achieved via other purchases such as mortgage or auto loans. Diversity counts for a lot.

Of course the other side to that is if you are buying cars or property for most of us that isn't something you are going to pay off in a month or 2. Are you saying you can only achieve superb credit buy paying interest to banks for essentially doing jack shit other than loaning you money they have bucket loads of anyway (adjust for point in history)? That doesn't seem like a nice world.

[Jekblad]

it's almost like the banks are running a BUSINESS....

[beats me]

it's almost like the banks are running a BUSINESS....

Who let this guy in?

Have you been in a coma for the last 2 years and are unaware on how banks "running a BUSINESS" fucked up the world economies and a lot of people's lives?

[beats me]

[Jekblad]

Going upside down on your first house makes you pretty aware.

I think there are people who are in a coma where they think they are being provided a "service" when they are actually paying for a product.
When it comes to borrowing money.

[Tarekith]

The biggy is just to always pay off the card and your other payments. One missed or late car payment can follow you around longer than you think.

My wife and I did basically what others suggested, used a few different cards for every day purchases and paid them off on time for a few years. By the time we were ready to buy our first house, our credit was great and the whole process was SOOO much easier. Once that was done we cancelled all but one card that has great reward points and forgot about credit cards.