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Have I got a deal for you!; If you are young
Topic Started: Oct 29 2004, 07:43 AM (469 Views)
Adrian
Lieutenant Commander
I recently had to buy a car (the old one blew up-literally) and found because I didn't have any credit history, I was forced to take a huge interest rate.
I do advocate keeping a VERY small balace on the card; enough you can pay off immediatly if need be. Also, "bank" at a credit union instead of a bank (better for the credit rating and loan rates).
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Dandandat
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Time to put something here
Adrian
Nov 1 2004, 01:26 AM
I do advocate keeping a VERY small balace on the card; enough you can pay off immediatly if need be. Also, "bank" at a credit union instead of a bank (better for the credit rating and loan rates).

Very good idea if you cant trust your self using credit. This combined with what 38 said may be the best way to go until one became more mature and able to see the future for what it is and can plan for it properly.

My parents got me into paying bills quite early in my life. When I was around 16 they set up my first real back account (I say “real” because I have always had a back account for college savings and stuff but I was not in charge of it), they also got me my first credit card (which I still have to this day) . After that I had to directly pay for all my expenses (aside form room and board which my parents provided). Paying bills started off slowly because at 16 you don’t have many, (they came in the form of credit card bills for cloths and school supplies that I needed and ect), but over the next few years it started to increase with my first car loan, car insurance, pre-college expenses and then college expenses. They taught me how to properly us my credit, and made it every clear that if I ever did something stupid with it that they would not help me out in any way. It helped that my mom is on the supper stingy end instilled in me the notion of “what do you need that for…”. But lucky my dad balanced it out with being caviler with money on rare occasions. I grow up with the idea that on a day to day basses you have to make ever penny count to a fault, but every now and then to keep your self happy you have to splurge a little. Its worked quite well for me, I got through college with no loan expenses, I have always had the luxury of having new or slightly used cars (with low car insurance rates), and my credit history is exhalent and extensive (just need a good standing home loan to top it off).

My wife on the other has had some credit problems, she was always bad with her credit – spending it as if it was not her money and then because of family matters she was stuck with $40,000 business loan for a business that when under shortly after the loan was taken out. While her family was paying off the $40,000, I tried to get control of my wife’s (she was not my wife at the time) other credit run ups. I had a plan that I would pay it off slowly over the next few years so that by the time we where ready to get a house it would be gone. But then as money often does her family started to get angry with each other and the person really responsible for the $40,000 stopped paying it and ran out of town, leaving it to my wife to deal with. I wasn’t about to take on the $40,000 as well as my wife’s other problems so she had to file for bankruptcy. For the most part her bankruptcy did effect us (expect for her self esteem) since I am the primary bread winner and I have good credit and salary for the things we need. But I am worried what it will mean when We try to get a home lone in the near future. While my credit is good, it often takes both wife and husband to have good credit to get a good home loan when you are middle class. We will see.
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Swidden
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Adm. Gadfly-at-large; Provisional wRench-fly at large
I have a couple of credit cards, but both my wife and I have (separately and together) always maintained a policy of paying the whole bill at the end of the billing cycle. No carryover charges, no interest charges, no problem. As a result we have taken to make sure that any card we have has a cash reward/rebate program. Usually 3-5%, so it's like buying everything on sale... :D :angel: :whistle: :woohoo:
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Hoss
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Don't make me use my bare hands on you.
If you want to spend most or all of your income on beer and pizza, acknowledge and plan for it on paper first. The say goes: "If you don't manage your money, somebody else will" or something like that.

The credit thing is a paradox, if you don't have good credit then you can't get a loan. But if you pay for stuff, you don't need credit! You can always open a no-load credit account and charge nothing on it to give yourself some available credit on paper if you like.

If you buy something like a TV or stereo or whatever on credit, you're just not being mature. Maturity is deferring things like this until you can afford them.

One thing I learned recently was in our budgets, we now take groceries off the top (not the bottom). Before, I was paying the bills and saying "this is what's left for groceries" And my wife was "whatever, kids gotta eat" and charging crap on the card. I pay for groceries before I pay the first bill now. And if there ain't money left for cable TV and cell phones, it gets cancelled (nothing to argue about)! My wife and I have both agreed to this plan and it is working.
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Fesarius
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Admiral
I work with a colleague who uses her credit card for all of her bills (with the possible exception of her mortgage). So, her phone, electric, propane, etc. bills are charged, and then at the end of the month (or billing cycle), she has them all consolidated on to one bill. I suppose that that is okay assuming that she pays it off each month. :yes:
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Hoss
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Don't make me use my bare hands on you.
Quote:
 
I suppose that that is okay assuming that she pays it off each month.

All it takes is one bad month and you can't quite pay it off and there you are. But if she has sufficient savings to ride out a bad month or two, she may be ok.
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jjtrek
Lieutenant Commander
Dan, my hubby and I both had to declare bankruptcy in 1995. We are looking forward to 2005 since at the 10 yr mark, the bankruptcy should be wiped off our financial records.

Once a bankruptcy is "discharged" (the wolves, er, I mean, creditors are all gone from your door) each lender you seek credit from has the right to refuse you.

Once the 10 yr mark is reached, and you see that the bankruptcy is cleared from your credit report (you can get them free online), then there should be no (or nearly no) hassle in getting a loan.

We're actually looking into the possibility of getting a small house next year!

Julia
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Sophie
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Keeper of the spider-cats
I'm not interested in getting a credit card even though I keep getting offers for a platinum one. <_<
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Fesarius
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Admiral
^^^
Good for you (seriously). The temptation is often too great. :)
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Deleted User
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I thought about it once, but ran away screaming about a millisecond after the thought. Funny, i'm not sure what i was running from.
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Fesarius
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Admiral
^^^
Once those finance charges kick in, you'll see quite a change. Also, don't pay anything late--that will kill you, too. I learned from my mistakes, and won't do it again. :no: ;)
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Deleted User
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I'm barely coping with the debt i'm in with the bank at the moment, i don't need a credit card to add to that.
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Dandandat
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Time to put something here
38957
Nov 3 2004, 10:05 AM
The credit thing is a paradox, if you don't have good credit then you can't get a loan. But if you pay for stuff, you don't need credit! You can always open a no-load credit account and charge nothing on it to give yourself some available credit on paper if you like.

Their is more to it then having a card and not using it to get good credit. When a Bank hand you over a home loan or car loan they are going to look at more then the fact that you have one. They are going to look at our spending habits and whether you pay off your credit. If their is nothing for them to look at they may be leery in giving you a loan because they wont have the same level of confidence. I do agree with your idea of having everything planed on paper and properly managing ones money, but I do not agree with the idea that credit cant be a part of that plan. You just need to know how to manage it and how to properly take it into account.

Quote:
 
If you buy something like a TV or stereo or whatever on credit, you're just not being mature.  Maturity is deferring things like this until you can afford them.
There is also the different between buy "on" credit or buying "with" credit. I buy almost everything "with" credit, I don’t like carrying cash around with me. If I want to buy a TV or stereo I will put it on my credit card and pay for it by check at the end of the billing cycle. But before I do that I know I have the money to pay at the end of the billing cycle, so in a sense I am paying cash just not at the time of my perches.
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Dandandat
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Time to put something here
jjtrek
Nov 3 2004, 04:21 PM
Dan, my hubby and I both had to declare bankruptcy in 1995. We are looking forward to 2005 since at the 10 yr mark, the bankruptcy should be wiped off our financial records.

Once a bankruptcy is "discharged" (the wolves, er, I mean, creditors are all gone from your door) each lender you seek credit from has the right to refuse you.

Once the 10 yr mark is reached, and you see that the bankruptcy is cleared from your credit report (you can get them free online), then there should be no (or nearly no) hassle in getting a loan.

We're actually looking into the possibility of getting a small house next year!

Julia

JJ,

Alas I plan on buying a home with in a year, at that time my wife’s bankruptcy will only be about 3-4years old. I can't wait other 7 years to get a house, so I am hoping that my good credit will carry us.
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jjtrek
Lieutenant Commander
Dan, my prayers and thoughts of good luck go with you. I hope you find that dream home! :D

Julia
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