Topic: How much do you value your credit score? (Read 10728 times)

I would give up my plans for world domination if I had to use that piece of fancy Cupertino garbage.

It is kind of a paradox of how the credit system work. Normally, people who have asset and no debt should have higher credit score.

When you have no debt like this your credit score will likely suffer and it will be hard to get credit when you really need it. Even if you have sufficient assets today you never know what tomorrow will bring to you financially.

yeah I agree up to a point....am doing so now...but way back when on my previous choices... in my case deciding to get the house paid off was equiv to 1K raise in real $$$ at my payment net $$ of $650/m back between  (got house 2000) and 2004 when I decided to just go for it and pay off the house for the above equiv 'raise' so to speak..and paid
it all off nov 2007 by the by.

of course now I invest $$$ more in stocks/etc as you state above but as far as house improvements etc..I don't have to use the home equity loan to do so..it is just there
in case my chimney falls down or something else odd mainly because I also found that instead of 1000 usd or some such for home owners insurance...full boat no deductible
that was required I have because of the home loan and the bank etc.....I by changing it to 5K deductible save  around 250 usd per year or $750.....so I take this gamble with the knowledge
that I can if disaster strikes just 'eat it' and use the 'unused' catastrophic fund which is the purpose of my home equity loan..to make up that 5K should I need to...anyway my logic and another way to save if you like them odds

again this is what I did ...risks/rewards etc admittedly in my case in 20/20 hindsight it was the right choice with the economy tanking in fall 2007 (was it?)....saved me getting
a 2nd job that is for sure...anyway my choices for illustrative purposes/angles.

anyway my 2c worth

Searing

If you now have no debt, and no housing payment (expect for taxes and insurance) it would be advisable to invest more money into investments (be it stocks, bonds, traditional savings accounts, or other types of investments) so you can save for a "rainy day" and for retirement. You likely do not want to be working up until you die and when you do stop working you want to be able to live comfortably. This is likely the same advice that you would receive if you were to speak to any financial adviser or financial planner.

yep older....had a student loan i paid off ..so when I got my house around 2000 after the dot com crash of stock market then pres Bush the jr...got us into IRAQ...EVERYONE
was telling me to get into stocks at that point...sorry ....so I looked around and figured screw it pay the house off from 2000...who is gonna give me the equiv of a 650/m raise (NET) would be closer to 1K raise in the next few years....paid if off in 7 years months before the stock crash /great recession

good thing I did or I'd of had to keep a 2nd job for the house payments...now no debt ..just house utils ...no cc debt (amex have to pay it off each month) so that $650
house payment is gone ...of course some of that goes into the house but I can use 'denial' on that heh

Searing

Medical expenses is too high because of government interference and rate rigging from insurance.

In any case, people need to save more and live within one mean.

This is technically true, however most people do not have the resources to never have to borrow from the bank, especially during their earlier years (prior to turning 45ish). When people get older they will have to rely less on bank loans, but they still may need one in case of an emergency (unemployment, medical expenses among other things).

just remember after you need it to get a house or car or whatever you can call up the big 3 credit score
agencies expeian transunion and equifax and have a security freeze put on them so that someone else
has to use that code to get info on your credit score before they can approve for a car loan or house
loan fraud etc.with say your stolen identity...it is worth the hassle just not to get all the junk mail...
if you have security freeze on your credit score...no one can spam you with offers etc

want to take out loan again ..unfreeze it and they ask you when would like to freeze it again
just give enough time for the auto dealer or house realtor or whatever to get a score you need
before you put the security freeze back on

helpful...my home 10yrs ago was burglarized but stuff was looked thru etc...even with that info
no way to use it because theives had no access to the security code to take off the credit
score security freezes..

my 2c worth
Searing

am not using any credit score for now

Thanks I was wondering what a security lock was and looked it up good stuff from 2007 nice, and I agree with you that taking a Home Equity loan is way better than a Visa for pinch borrowing, that or perhaps a line of credit if you can get a good rate.

As long as its paid off its fine otherwise they take the house but it's a calculated risk.
Courts have held that a bank may freeze a HELOC in instances where a home's value decreases substantially, which is deemed by courts as a 50% reduction in value.

With the credit cards as long as it doesn't mess with my Bitcoins that's fine with me
Although I guess a rewards card that gives cash or something is best

I'm a Mustachian and a fan of responsible credit card use: they can help you raise your credit score, they offer purchase and consumer protections you can’t get anywhere else, plus they automatically track your purchases and provide healthy amounts of cash-back rewards each year as well. Just be sure to use them in a Mustachian way.
http://www.mrmoneymustache.com/credit-cards/

That said I'm all for gaming the system (Teach them to put people into debt with the revolving balance trap)
I value my credit score in that I can get a bunch of promo offers and free money heh
http://www.mrmoneymustache.com/2012/01/23/gaming-the-system-with-rewards-credit-cards/

And sometimes you can get a 3% rate a tad lower than the line of equity in a house for a year while combining a rewards system to it.

FROM MMM

Sometime around 2006, when interest rates were high and yet credit was still loose, Chase started sending me checks for my business card that could be used to pay any bill – and they were offering a 0% annual percentage rate. After reading the fine print, I saw that the conditions were favorable. So I used one of those checks to max out the card’s $50,000 credit limit, and used the proceeds to pay down a construction loan which had been charging  me 7%. This allowed me to pay the much better rate of Zero percent for one year instead. Meticulously noting the payment deadlines, I played it carefully and paid it off on time, saving several thousand dollars in interest.

Today, the credit card companies still send similar checks, but they now have much sneakier conditions like “0% APR for one year!” (except a fee of $10 or 3% of the balance, whichever is greater). Excuse me, but that’s a 3% APR, about the same as my existing home equity line of credit. Trying to mislead customers like that is a huge FAIL and should be illegal. So I now mutter a few swear words at the bank as I shuttle each of these offers from the  mailbox to the document shredder.

On cancelling credit cards
It will probably cause temporary dips to your credit rating, since you are triggering inquiries on your account. But by eventually cancelling any unneeded temporary cards, and being sure to keep your oldest card active, you should still end up with a continually increasing credit score. I don’t care about my own credit score in the short term, since I have no borrowing planned. In the long run, however, I do want to keep it up in the 800s in case I ever want financing on a future house or investment.
__

..getting out of debt is equiv
of dropping that 2nd part time job...

Amen to that debt is slavery in a sense that you will always be indebted to something until you pay it off completely.

Swords

If you get to an age when you can pay off ALL your debts....or have a way to do so I did below

or can eventually say your visa bill gets low enough a modest car loan line of credit

then get to a point where you can pay off your house....and swing a home equity line of credit


do this

Get a Home Equity Loan ..even if it costs you some coin as your catastrophic emergency fund to draw on
at 30k for my house and 3.99% APR ....well sure beats a credit card for those emergences..may cost you 1.5k
up front to secure such (or not some legit banks have deals..I'd go thru a professional commercial bank) but
worth it for piece of mind imho.

Get a Green of Gold American Express card ($50 usd green card a year $75 gold card) If you get the gold
card they have as a perk the equiv of AAA car service club (that also costs $85 a year) so I call it a draw.

The reason for the amex card is in an 'emergency' I can put on 10k or more ..then I have like 40 days or
some such to pay ..you HAVE TO PAY with the above cards or face them being taken away or paying some
high interest rates like 28% or some such....but that is the purpose of these cards..that is why they
call them 'privilege cards' the $$$ are made on he merchant 3-4% not 1-2% like accounts that let you
carry a balance

anyway it is better to drop the 10K on the card in an emergency and then go to bank and take out
the old home equity loan you have setup already then when you have time the $$$ needed from the home equity loan and
pay 3.99% then have a Visa with a cc balance and pay 19% more or less...You can use such cards
to get out of debt with your current cards..me cut up my 2 visa cards paid them down ..used this card
to get out of debt in 2 years on the visa stuff w/o danger of using a cc card (the amex) too much
because it always had to be paid off each month

anyway I still use the amex cc all the time ..but don't get caught in the revolving balance trap and
that you can't get caught up at 19% cc interest/fees...my only card is the gold amex card (23 years)
only cost is the $85/year and that includes the equiv of the AAA road plan I used to have instead...
the amex card makes its money off the merchant

last point this is what applies to credit score..NO I don't care about it

Also the credit card score agencies etc like

Transunion and Experian and Equifax (sp?)  the top 3..the main one used on house/car loans/ cc cards etc
.lock them all out with a security lock..best decision I ever made ...no one wants my credit info to steal now too hard
.IF YOU call them up they will allow you to put a PERM SECURITY CODE on these major credit score agencies
for like $15 I think ....That means NO ONE  can see your credit score..or send you spam
or take a loan out in your name etc via Identity theft with any hope ..if they have to get
a credit scrore etc to get said loan..new cc card or whatever..impossible your credit rating is locked up
to way for scammers to get info to make a fake cc or loan in your name

so if you need to buy a car or something that needs a credit score ..you call them
(may have to google the 800 numbers) and give code and they can ..usually standard
take your security lock off your info ....usually standard 30days and then it goes back
on.if I remember this is $5 to take it off for 30 days then it goes back on is standard setup

So no spam no people trying to get you to buy cars or get the newest cc etc because
when they try to get your credit score to spam you or rip you off it is locked

anyway my 2c worth the above works really well....getting out of debt is equiv
of dropping that 2nd part time job...helps a lot your piece of mind and with the
above you are covered in any emergency w/o getting ripped off...with the added
benefit is it is always in the back of your mind on the amex card it has a limit..so
if i need that new car or whatever I go to the bank ..get the old home equity
line of credit $$$ needed in cash and pay them off month to month at 3.99% interest

as an example I have 7500 usd on my home equity loan..the interest is about $25
the amount applied towards principal (loan) is around $25 the min you can pay
is $50 on such a monthly payment plan

I pay if off in 2 months ...I"m down $50 in cost

Hope it helps but NO...credit scores mean little ..except as a basis to block info
so you are not bothered once the 'real world' finds out you have no debt...thus
the credit score security locks...once out of debt you are pretty careful in that
you don't want to go thru the pain in the ass of paying 19% cc cards off again!

IF you still have debt on a visa...cut it up ..get the amex card that at least
you know you can't float over the limit forever w/o consequences or it gets
taken away (only gold and green amex thou .not the other amex new cc)

lot easier to pay that visa card down to 0 after you cut it up ..if you are
not adding to it any emergency..need a simple emergency fund don't have
your house paid off? get to a point where you can get an auto loan...for say 5k
and just pay it back in full in say the next month..main thing is you have the
line of credit now for 5K....(or a car.....that hopefully you can pay down
to have the extra as equity fall back)

well hope it helps it got me out of 10k of cc debt on 2 visa cards once I
did this after cutting up the visa cards and just using the amex card
and the car loan line of credit quick for emergencies (cataract surgery
for a hit to an eye ....2.5k not on the visa on the car loan equity thingy)

anyway just saw the does your credit score matter question here
in the above cases you could care less what your credit score is
because w/o debt it is gonna be like 840 to 900 excellent anyway
esp with a paid off visa/car loan /house and legit gold amex card!

so no credit score don't mean squat if you manage to get out of debt!
or at least have a backup cash plan outside of just a 19% cc option.

good luck

Searing

True the only times the credit score is really needed is when you get a mortgage on the house or on a car.
The rest of the time a credit score is not very important.

Credit score has little value if you don't plan on borrowing money from bank.

I had the same concerns. After I gave bank credit the finger my financial situation got better. Now I have offers of private credit from people and even my bank has told me they would loan me money anyway. I told them "no thanks". The hard part is trying to keep my credit "Un-scorable". If they found out how trustworthy I am they would jack my rating up. I don't believe in their scores and don't want to participate in them. When I say that at the bank... they ask me if I want a loan. 

I wish I could be in the same position as you where it wasn't important to me, but the truth is I have things/loans/etc that depend on this score so I need to maintain it.

You're in for a nasty surprise when iTunes revokes your use privileges when you try using it to manufacture chemical weapons.

Continuing the above discussion, it's really all about doing what you agree to do. If you agree to pay back borrowed money with interest, then you need to do exactly that. The law is written to require that your end of the bargain be upheld, and that is how it should be. In the end, you have to take responsibility for signing on the dotted line.

^Do not quote me on this in reference to terms and conditions. Legally, I did "agree" to Apple's terms and conditions but I do not consent to any 40+ page legalese document to use a freaking phone.

This is not true. If there is enough money to pay off the loan then any excess funds are given to the borrower. You also fail to account for the fact that most of the 90k is interest and not really paid back to the bank but rather additional amounts owed by the borrower.

They want most people pay on time, so they will have a low risk income, but also want people that sometimes delay the payments, so they can charge more interests and gain with taxes.

I know some people that work in risk management for banks.

Maybe the attitude varies from bank to bank, or from country to country, or depends on the trust on the economy