Bank of America Presents: Visa with the Vig!

[Flubber]

Originally posted by DinoDoc
Why do you feel the need to build an "I love debt" score? If you always have enough money to pay the bill off at the end of the month, why not just get a debit card?

because it helps if he ever needs credit-- If for instance he ever wants a house or car for which he has curently not accumulated the funds ( but which hopefully is well within his means)

[Japher]

If it's 'in his means' then you should be able to a) pay cash or b) get a loan from an underwriter who will assess your ability to pay the loan instead of some FICO score

[Lorizael]

Originally posted by DinoDoc
Why do you feel the need to build an "I love debt" score? If you always have enough money to pay the bill off at the end of the month, why not just get a debit card?

I have a check card too, which I use for most of my purchases. The credit card, however, pays for certain static monthly payments I have to make, like my transportation costs to and from work.

This way I always know exactly how much I will need to pay off at the end of the month and I can have the funds ready to do so.

The credit card is an investment for the future, rather than a tool for the present. Building credit will help me make purchases (a car, for example) in the future that I could not make just by saving cash.

That said, the credit card has been a tool on a couple of occasions. For example, a couple months back my check card accidentally got switched with someone else's at a restaurant. Because I was unobservant (and didn't have to use my card for several days) I didn't notice the switch until I attempted to use the switched card and found it canceled. So... I had to cancel my own check card and wait for a new one to come. In that period of time, having the credit card around was extremely handy.

[Patroklos]

Why do you feel the need to build an "I love debt" score?

House loans, of which my lack of credit in early life is certainly making difficult for me.

At least it was until I spent a year building credit

[DinoDoc]

Originally posted by Lorizael
Building credit will help me make purchases (a car, for example) in the future that I could not make just by saving cash.

Why not? We have this process called saving now that seems to work wonders.

House loans

What Japher said applies here.

[Flubber]

Originally posted by Japher


Lorizael, what do you mean by "build credit" and once you have this credit what do you want to do with it?

I leveraged some long term investments. The amounts I use are not huge but when I was getting credit at less than 5% and my investments did far better than that, it seemed a good idea.

I am much more cautious right now.

[Lorizael]

I already said I had a savings account. But saving takes time.

I drive a nine year old minivan. I expect that it could die at any moment. If it does so, and I have no credit, then I have to wait several years to build up the savings to buy myself another car.

With credit, however, I can wait a few months to put down a substantial down payment, and then get a fairly decent car loan based on my fairly decent credit.

[DinoDoc]

How much do you have in that account? $400?

[Koyaanisqatsi]

Re: Bank of America Presents: Visa with the Vig!

Originally posted by Rufus T. Firefly
Anyway, deep in the pages of fine print we learned that Bank of America now reserves the right, after 2 late payments on our part, to raise our card rates . . . to 32%.

Some of the offers I've been getting are similar. Miss one payment on any account and they all jump to a default rate of 36%. While the normal rates are ok, I wouldn't sign up for that just based on the idea that even a single mistake (on my part or the bank's) would completely hose the account.

[Patroklos]

What Japher said applies here.

Thats not how it works. No matter how much money you have or how much you make, if your credit history shows that you have trouble paying on time (laziness) or you have never had to worry about it before (inexperiance) they will give you less even in techinically you should be able to aford it.

[Japher]

5% is good, but it's not tax deductible and I don't see any reason to pay anyone anything for spending my money.

School Loan and HELOC are the only two types of loans that are even close to justifiable. Even the HELOC doesn't make sense if you go along the pay to play principle. School Loan, however, are your only hope sometimes to get an earnings potential.

Credit Cards do nothing but rip you off. I paid all mine off and won't use them any more. A few weeks ago I got a bill that 34.something had been charge on my card. I called and they told me it was my payment protection plan, I told them I had not signed up for that and that they were committing a crime by charging me that. It took me 20-minutes of telling them, repeatedly, that I didn't want it and to take it off and stop charging me before the complied. Evil.

[Japher]

No matter how much money you have or how much you make, if your credit history shows that you have trouble paying on time (laziness) or you have never had to worry about it before (inexperiance) they will give you less even in techinically you should be able to aford it.

Bad credit isn't no credit, and will get you in trouble. If you have bad credit, make it good, then stop using it.

No credit isn't bad credit and will still qualify you for a loan. I don't know what lazy creditor you are going through who won't underwrite a loan, but if you have 2 years of steady income, have shown that you pay your bills (rent, electric, phone, etc.) on time, and have a good down payment you CAN get a mortgage.

[Lorizael]

Originally posted by DinoDoc
How much do you have in that account? $400?

My savings account? Over a thousand.

[DinoDoc]

Then why would it take you years to get a car once that one dies?

[Lorizael]

Originally posted by Japher
Bad credit isn't no credit, and will get you in trouble. If you have bad credit, make it good, then stop using it.

No credit isn't bad credit and will still qualify you for a loan. I don't know what lazy creditor you are going through who won't underwrite a loan, but if you have 2 years of steady income, have shown that you pay your bills (rent, electric, phone, etc.) on time, and have a good down payment you CAN get a mortgage.

From experience, I can tell you that having no credit when trying to take out a car loan is a ****ing *****.

Originally posted by DinoDoc
Then why would it take you years to get a car once that one dies?

Because I don't want to buy another car that will also be on the verge of death? Also, because $1000 in my savings account (and a variable amount in my checking account) is the least money I ever want to have. I want a buffer for emergencies. I don't want to save up and then blow all my savings on a car, leaving me with nothing for the unexpected things in life.