The Family Piggy Bank

Bluetick
Can someone please help me learn how this works?
July 25, 2013 at 5:33 PM
Here's the deal... I have always paid up front for everything I own my house and my vehicles out right, I never went through the SPEND phase of life. Therefore, I have no credit!! Not a cell phone or a loan NOTHING ! So now I'm 30 years old and I'm trying to start building credit here's the problem.... The only thing I can fin to help me start is a secured credit card -- mainly because I have no history of making payments! Some of these companies is denying me because of no history !!
What is the best way to build credit WITHOUT getting in a lot of debt ?
Also I don't understand te terms used in credit for example " a account paid and closed" or a account "paid as agreed" ?? How about account "closed" only?? Any help would really be greatly appreciated !! Thanks in advance :)

Replies

  • QuiltLover
    July 25, 2013 at 5:46 PM

    Account paid and closed....means you HAD an account, paid it off and closed it

    Account paid as agreed means you paid the account as you agreed with the lender that you would


    As far as building credit, you can use the places you rented, if you ever did, you can use your utilities as bills, you can open an account, whatever that would be and then make a few payments, and pay it off....it is very hard to build credit, but, in my opinion, you have done it all the right way...congratulations....I know this isnt what you asked, but kudos to you....

  • maggie268
    July 26, 2013 at 8:51 AM

    Your best bet would be to do a secured credit card or loan to start off a good payment history...  this means what ever the limit is on your credit card that is how much you have to give them up front and they will hold it for the term of the credit card or loan.

  • baconbits
    July 26, 2013 at 1:47 PM

     You could also get a small personal loan from a bank and pay it back. You'll need to keep it open for 4 - 6 months with payments but it will help. You can also get department store credit cards easier then MC/Visa. If you want you can actually get a Sears credit card, charge something on it and then walk over to their customer service and pay it off all at the same time. This is what my sister did to build up her credit.

    Just be aware and not fall into a trap where you start using credit cards thinking you'll pay them back. Use them wisely when you do get one.

  • KLove_Mom
    July 31, 2013 at 10:39 AM

    First... if you've never needed credit... why do you need credit now?

    If I were you, I'd just keep paying cash for everything.

    There ARE companies that will do manual underwriting of a loan for a mortgage, you just have to find them and request that stating that you always paid cash and don't have any debt.

    Here's a great article to read about this subject.
    http://www.daveramsey.com/article/the-truth-about-your-credit-score 

    And here's a great story about a young woman just like you who pays cash for everything, even her nice house.

    http://www.daveramsey.com/blog/video-the-house-that-cash-bought


     

  • FindersKeepers
    August 2, 2013 at 5:22 PM

    I have a friend who did something similar.    He always paid cash for everything, but wanted to get a loan when it came to a mortgage and was surprised to find that NO CREDIT was worse to the bank than BAD CREDIT.    Sad but true, people that use cash for everything have the credit rating as a teenager.  

    If you want to establish credit, start with a credit card and make a purchase less than 25% of your limit that is going to require payments.   The make more that the minimum each month and pay on time.   Paying the full amount each month will still not show you as carrying a balance.  You have to establish a credit, payment history. 

  • muisjes
    by muisjes
    August 7, 2013 at 9:41 AM

    if you think about it, it's actually kind of crazy that you need credit cards or some debt to be able to have a good credit history...

  • JackieHauser
    August 9, 2013 at 8:49 AM

    I went through Dave Ramsey's Financial University Class and loved it!  It is best to get into a class where it is offered like a church or something.  You share ideas and thoughts with others and there is accountability that way rather than just taking it on line :)  I do believe though (personal opinion only) that it is good for all to have a line of credit because as Dave says emergencies do come up.  Things may happen in our lives we never expected and we cannot always have cash readily available for some of the unforseen instances that life throws our way.

    Quoting KLove_Mom:

    First... if you've never needed credit... why do you need credit now?

    If I were you, I'd just keep paying cash for everything.

    There ARE companies that will do manual underwriting of a loan for a mortgage, you just have to find them and request that stating that you always paid cash and don't have any debt.

    Here's a great article to read about this subject.
    http://www.daveramsey.com/article/the-truth-about-your-credit-score 

    And here's a great story about a young woman just like you who pays cash for everything, even her nice house.

    http://www.daveramsey.com/blog/video-the-house-that-cash-bought


     

     

  • clairewait
    August 10, 2013 at 4:31 PM

    You can get a credit card. Trust me, they hand them out like Halloween candy to college kids.

    I'd start with Capital One, personally, unless you have USAA, then go with a bank credit card. Capital One happens to have pretty good rewards.

    Anyway, just get a credit card and use it, then pay it off IN FULL at the end of the month. You'll probably only have a $500 limit at first, but they start raising it pretty quickly.

    Credit cards are not from the financial devil, contrary to popular belief. They are actually the most convenient and secure way to pay for things right now, and are competely safe (financially speaking) if you can have the self control not to spend more than you have. Just make it your cardinal rule that you will always pay it off in full.

    We use a credit card for EVERYTHING that we can, and build up airline miles (we have the Southwest Visa because it is the one airline we use the most). We typically earn between 2 and 4 free tickets a year. I've never had to pay interest on a credit card in my life because I've always just paid off the balance each month.

  • Bluetick
    August 14, 2013 at 4:21 PM
    Reasons I want credit
    I might have a emergency expense
    Maybe buy a new car
    Help out with my dd's college tuition
    Loose my husband

    There are a lot of scenarios you NEED credit to handle

    Quoting KLove_Mom:

    First... if you've never needed credit... why do you need credit now?

    If I were you, I'd just keep paying cash for everything.

    There ARE companies that will do manual underwriting of a loan for a mortgage, you just have to find them and request that stating that you always paid cash and don't have any debt.

    Here's a great article to read about this subject.
    http://www.daveramsey.com/article/the-truth-about-your-credit-score 

    And here's a great story about a young woman just like you who pays cash for everything, even her nice house.

    http://www.daveramsey.com/blog/video-the-house-that-cash-bought


     

  • KLove_Mom
    August 16, 2013 at 3:29 PM

    How is having $25K available on a credit card any better than having $25K in a savings account in those cases?

    With the credit, you have the added risk of "Oops, I missed a payment and they jacked up the interest rate." AND, with credit you pay the interest if you didn't use your savings account to pay it off that month anyway.

    So I propose that in every situation you listed, $25K in the savings account is better than good credit.

    P.S. 
    I'm Actually ALL FOR you having control over your own money, and making decisions for yourself. I just wanted to show you a different side.

    If you decide to get a credit card to use and pay off every month that's how you'll build your credit up. That's your prerogative, as long as you know you'll be deciding to live with the risks involved too.  :)

    Quoting Bluetick:

    Reasons I want credit
    I might have a emergency expense
    Maybe buy a new car
    Help out with my dd's college tuition
    Loose my husband

    There are a lot of scenarios you NEED credit to handle

    Quoting KLove_Mom:

    First... if you've never needed credit... why do you need credit now?

    If I were you, I'd just keep paying cash for everything.

    There ARE companies that will do manual underwriting of a loan for a mortgage, you just have to find them and request that stating that you always paid cash and don't have any debt.

    Here's a great article to read about this subject.
    http://www.daveramsey.com/article/the-truth-about-your-credit-score 

    And here's a great story about a young woman just like you who pays cash for everything, even her nice house.

    http://www.daveramsey.com/blog/video-the-house-that-cash-bought


     


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