Do you need a credit card?

[CPA]

Don't do it and don't listen to the folks who say "get a credit card NOW. You need it!"

BS, you don't need it.

On average, credit card users spend 12-18% more per purchase.

More than 60% of credit card holders do NOT pay off their card monthly - in other words they carry a balance.

You can get a home loan without credit, you just get a manually written mortgage.

Pay for a car with cash and buy it used, not new.

Get a debit card for auto rentals or anything else you may need a "card" for.

 

[Xavier434]

Originally posted by: CPA
Don't do it and don't listen to the folks who say "get a credit card NOW. You need it!"

BS, you don't need it.

On average, credit card users spend 12-18% more per purchase.

More than 60% of credit card holders do NOT pay off their card monthly - in other words they carry a balance.

You can get a home loan without credit, you just get a manually written mortgage.

Pay for a car with cash and buy it used, not new.

Get a debit card for auto rentals or anything else you may need a "card" for.

You are missing the point. No one here is arguing that you cannot get this or that without a credit card. All that we are saying is that those with lengthy good credit histories get the best that the banks have to offer which can often be a huge difference. Have you ever considered how much more one pays over the course of a 20 year mortgage on a $250,000 home at 7% as opposed to 6% for example? Also, very few young people can afford to pay for a used car in full using cash unless they get help from outside sources of income such as family. Starting off with a credit card is a great way to go if you are responsible. You are in complete control of that card.

 

[Special K]

Originally posted by: Beattie

Originally posted by: Special K

Originally posted by: Beattie

Originally posted by: Special K

Originally posted by: Beattie


False. You qualify for the same rates with no credit history that you do if you have a very high credit score.

This is wrong. When I was in college, I applied for a private student loan. I had no credit history prior to this. The rate they were offering me was something absurd, specifically because I had no existing credit history. I had to get a parent to cosign the loan to qualify for the best rate.

As another example, a couple years later I tried to apply for a credit card. I was denied because of "insufficient credit history". That is exactly what it said in the denial letter I received.

Where from? An big bank or a credit union?

The reason the big bank you applied for the loan from denied you is because they didn't care to do any of the legwork.

It was a big bank. What do you mean they didn't want to do the legwork? How difficult is it to pull a credit report? They were apparently willing to do the legwork to verify my parents' credit, and just because a person is older does not automatically mean they have good credit.

I don't know your specific case and so I really can't comment but most of the time lenders are reasonably generous with student loans. And checking your parent's score to co-sign isn't leg work. It's just getting another number from a computer.

Well your original statement:

Originally posted by: Beattie
False. You qualify for the same rates with no credit history that you do if you have a very high credit score.

is clearly false in my experience.

 

[Beattie]

Originally posted by: AgaBoogaBoo
Beattie - let's say you're right for the time being. Do you have a single reason to not get a CC?

Scarpozzi's post for one. When you deal with companies that make money off of screwing you, you shouldn't be surprised when you get screwed.

In general though, no. My only point here was that having a credit history makes going into debt easier. And that's not something that you necessarily want. Some people can use it responsibly and not have problems, most can't.

 

[Beattie]

Originally posted by: Special K

Originally posted by: Beattie
I don't know your specific case and so I really can't comment but most of the time lenders are reasonably generous with student loans. And checking your parent's score to co-sign isn't leg work. It's just getting another number from a computer.

Well your original statement:

Originally posted by: Beattie
False. You qualify for the same rates with no credit history that you do if you have a very high credit score.

is clearly false in my experience.

I don't see how that contradicts. You didn't qualify for one loan based on your credit history and then another based on your income or whatever. You qualified differently because of the addition of your parent's credit history.

 

[Special K]

Originally posted by: Beattie

Originally posted by: Special K

Originally posted by: Beattie
I don't know your specific case and so I really can't comment but most of the time lenders are reasonably generous with student loans. And checking your parent's score to co-sign isn't leg work. It's just getting another number from a computer.

Well your original statement:

Originally posted by: Beattie
False. You qualify for the same rates with no credit history that you do if you have a very high credit score.

is clearly false in my experience.

I don't see how that contradicts. You didn't qualify for one loan based on your credit history and then another based on your income or whatever. You qualified differently because of the addition of your parent's credit history.

You claimed that one will qualify for the same rates with no credit history as they would with a very high credit history. I applied for a loan and was given the worst possible rate specifically because of "a lack of credit history".

By your logic I should have been approved for the best rate because I had no credit history and according to you, "You qualify for the same rates with no credit history that you do if you have a very high credit score."

 

[ric1287]

Originally posted by: Beattie

Originally posted by: AgaBoogaBoo
Beattie - let's say you're right for the time being. Do you have a single reason to not get a CC?

Scarpozzi's post for one. When you deal with companies that make money off of screwing you, you shouldn't be surprised when you get screwed.

In general though, no. My only point here was that having a credit history makes going into debt easier. And that's not something that you necessarily want. Some people can use it responsibly and not have problems, most can't.

That is one of the worst justifications for not having a credit card I have ever heard.

You realize that if you treat a CC like cash, the CC companies make $0 from you right? They actually lose money on you because of the rewards they pay out.

If you honestly think having no credit is a great idea...wow.

 

[CPA]

Originally posted by: Xavier434

Originally posted by: CPA
Don't do it and don't listen to the folks who say "get a credit card NOW. You need it!"

BS, you don't need it.

On average, credit card users spend 12-18% more per purchase.

More than 60% of credit card holders do NOT pay off their card monthly - in other words they carry a balance.

You can get a home loan without credit, you just get a manually written mortgage.

Pay for a car with cash and buy it used, not new.

Get a debit card for auto rentals or anything else you may need a "card" for.

You are missing the point. No one here is arguing that you cannot get this or that without a credit card. All that we are saying is that those with lengthy good credit histories get the best that the banks have to offer which can often be a huge difference. Have you ever considered how much more one pays over the course of a 20 year mortgage on a $250,000 home at 7% as opposed to 6% for example? Also, very few young people can afford to pay for a used car in full using cash unless they get help from outside sources of income such as family. Starting off with a credit card is a great way to go if you are responsible. You are in complete control of that card.

Your telling me he can scrape together 2-4K for a beater?

When you play with snakes, you're apt to get bitten.

 

[Special K]

Originally posted by: ric1287

Originally posted by: Beattie

Originally posted by: AgaBoogaBoo
Beattie - let's say you're right for the time being. Do you have a single reason to not get a CC?

Scarpozzi's post for one. When you deal with companies that make money off of screwing you, you shouldn't be surprised when you get screwed.

In general though, no. My only point here was that having a credit history makes going into debt easier. And that's not something that you necessarily want. Some people can use it responsibly and not have problems, most can't.

That is one of the worst justifications for not having a credit card I have ever heard.

You realize that if you treat a CC like cash, the CC companies make $0 from you right? They actually lose money on you because of the rewards they pay out.

If you honestly think having no credit is a great idea...wow.

Technically they still make money off of you via merchant fees, but there's nothing you can do about that since stores don't give you a "merchant fee discount" for not paying with a CC.

But for all practical purposes, you are better off using a credit card, paying it in full every month, and collecting the rewards.

 

[Alistar7]

Originally posted by: spidey07
Your credit score is dependent on the length of your credit accounts. It's better to start early at age 18 than wait and spend years trying to build a good credit score. Without history your score will tend to be very low leading to higher interest on loans and higher insurance, all around your life is much more expensive than somebody with good credit.

Time is one of the more important factors in your score. You don't need to ever have had any line of credit to obtain a mortgage (great income/debt ratio which is why they qualify), but having a good line of established credit will only make that easier and cheaper (lower interest rate most likely). Get a CC, even if it's a secured card. Use it sparingly and pay off the balance each month.

You should also start investing some $ towards your retirement, no matter how trivial.Compound interest is your friend oh young one. I would suggest a Roth IRA that allows you to make a one time, penalty free withdrawl for a down payment on a home purchase.

 

[Eeezee]

Get a credit card and pay it off online every week. The you're never charged interest.

I like the Chase Freedom card, it doesn't have the best rewards but it's in the top 5. It's generally 1% cash back on everything with 3% cash back on certain things (gas, food, etc.)

Get yourself a credit card and use it for every purchase that you'd make with your debit card. There is NO reason to use a debit card. Just keep your card paid off and it is like a debit card with better rewards, and it builds credit history.

There's no reason to live without a credit card unless you really can't control your spending urges like some people.

 

[Eeezee]

Originally posted by: CPA

Originally posted by: Xavier434

Originally posted by: CPA
Don't do it and don't listen to the folks who say "get a credit card NOW. You need it!"

BS, you don't need it.

On average, credit card users spend 12-18% more per purchase.

More than 60% of credit card holders do NOT pay off their card monthly - in other words they carry a balance.

You can get a home loan without credit, you just get a manually written mortgage.

Pay for a car with cash and buy it used, not new.

Get a debit card for auto rentals or anything else you may need a "card" for.

You are missing the point. No one here is arguing that you cannot get this or that without a credit card. All that we are saying is that those with lengthy good credit histories get the best that the banks have to offer which can often be a huge difference. Have you ever considered how much more one pays over the course of a 20 year mortgage on a $250,000 home at 7% as opposed to 6% for example? Also, very few young people can afford to pay for a used car in full using cash unless they get help from outside sources of income such as family. Starting off with a credit card is a great way to go if you are responsible. You are in complete control of that card.

Your telling me he can scrape together 2-4K for a beater?

When you play with snakes, you're apt to get bitten.

You're moronic if you don't use a credit card for at least the small purchases that you can afford on the spot. Instead of using your debit card at the grocery store, use your credit card. Pay off the card the next day using funds in your bank account.

Statistics are nice and all, but most ATOT users are fiscally responsible and pay off their credit cards without carrying a balance. The OP seems like an intelligent person who will do exactly that.

How can you argue with the fact that good credit is better than no credit? If you don't carry a balance around, then you're building good credit. It's very easy to not carry a balance unless you're a complete idiot.

 

[Baked]

Yes. I have 3 CC (1 of each flavor) and 1 ATM card. Got my 1st one shortly after I turned 18. CC is a curse only if you're a irresponsible dumbass like many Americans.

Do NOT go around and apply for every store CC you see. Very very bad idea.

 

[MikeyIs4Dcats]

bad credit - usually can get credit at high rates

no credit - usually can get credit at high rates

 

[narzy]

Get a secured card, basically you put money in to a CD account that backs the credit limit on the card (usually $500) That money then earns interest as you use the card and pay it off. if you default on the card they use the CD to cover the balance. After a year you can withdrawal the money in the CD and use it.

Basically the secured card opens a credit line on your history and allows you to begin establishing your credit relatively risk free. Eventually you will want to also get a loan on a car, even if you pay it off the day after you got it having that loan show up on your history will do wonders for your credit score and puts you in a good position.

 

[MikeyIs4Dcats]

.

 

[MikeyIs4Dcats]

Originally posted by: MikeyIs4Dcats

Originally posted by: Beattie

Originally posted by: Viper GTS

Originally posted by: Beattie

True, but all of your "protections" are company specific anyway.

No, they are not. They are inherent to the way that credit cards work (the CC company is a buffer between your money & vendors) and federal law (which actually dictates a $50 liability limit, but most if not everyone just drops it all the way to $0).

You really should just quit posting, you're embarassing yourself but you're too stubborn to realize it.

Viper GTS

You say that the protections aren't company specific and then say it's up to the company to lower your liability from 50 to 0.

Also,

http://www.ftc.gov/bcp/conline/pubs/credit/atmcard.shtm

Your protection for a debit card is actually the same for a CC as long as you report it within 2 business days.

http://www.pirg.org/consumer/banks/debit/fact.htm

 

[Beattie]

Originally posted by: Special K

Originally posted by: Beattie

Originally posted by: Special K

Originally posted by: Beattie
I don't know your specific case and so I really can't comment but most of the time lenders are reasonably generous with student loans. And checking your parent's score to co-sign isn't leg work. It's just getting another number from a computer.

Well your original statement:

Originally posted by: Beattie
False. You qualify for the same rates with no credit history that you do if you have a very high credit score.

is clearly false in my experience.

I don't see how that contradicts. You didn't qualify for one loan based on your credit history and then another based on your income or whatever. You qualified differently because of the addition of your parent's credit history.

You claimed that one will qualify for the same rates with no credit history as they would with a very high credit history. I applied for a loan and was given the worst possible rate specifically because of "a lack of credit history".

By your logic I should have been approved for the best rate because I had no credit history and according to you, "You qualify for the same rates with no credit history that you do if you have a very high credit score."

No, that's not what I said. I said you can qualify for the same thing manually as with automatic fico lending. Not that anyone can qualify for any loan regardless of their history.

 

[Special K]

Originally posted by: Eeezee


I like the Chase Freedom card, it doesn't have the best rewards but it's in the top 5. It's generally 1% cash back on everything with 3% cash back on certain things (gas, food, etc.)

Why wouldn't it be the best? You actually get 1.25%/3.75% cash back if you consider the fact that Chase will actually give you a $250 check for accumulating $200 in rewards.

What general-purpose card offers better rewards than that? Please don't mention those 5% cash back cards that new members cannot apply for any longer.

 

[Beattie]

Originally posted by: CPA
Don't do it and don't listen to the folks who say "get a credit card NOW. You need it!"

BS, you don't need it.

On average, credit card users spend 12-18% more per purchase.

More than 60% of credit card holders do NOT pay off their card monthly - in other words they carry a balance.

You can get a home loan without credit, you just get a manually written mortgage.

Pay for a car with cash and buy it used, not new.

Get a debit card for auto rentals or anything else you may need a "card" for.

*high five*

 

[Beattie]

Originally posted by: Xavier434

Originally posted by: CPA
Don't do it and don't listen to the folks who say "get a credit card NOW. You need it!"

BS, you don't need it.

On average, credit card users spend 12-18% more per purchase.

More than 60% of credit card holders do NOT pay off their card monthly - in other words they carry a balance.

You can get a home loan without credit, you just get a manually written mortgage.

Pay for a car with cash and buy it used, not new.

Get a debit card for auto rentals or anything else you may need a "card" for.

You are missing the point. No one here is arguing that you cannot get this or that without a credit card. All that we are saying is that those with lengthy good credit histories get the best that the banks have to offer which can often be a huge difference. Have you ever considered how much more one pays over the course of a 20 year mortgage on a $250,000 home at 7% as opposed to 6% for example? Also, very few young people can afford to pay for a used car in full using cash unless they get help from outside sources of income such as family. Starting off with a credit card is a great way to go if you are responsible. You are in complete control of that card.

Read up on manual underwriting.

Most people that are smart enough to pay cash and have money (instead of credit cards and debt) tend to rate better and get better rates than even good fico score borrowers. It's not because they have no credit through. It's because they have money.

 

[Beattie]

Originally posted by: MikeyIs4Dcats

Originally posted by: MikeyIs4Dcats

Originally posted by: Beattie

Originally posted by: Viper GTS

Originally posted by: Beattie

True, but all of your "protections" are company specific anyway.

No, they are not. They are inherent to the way that credit cards work (the CC company is a buffer between your money & vendors) and federal law (which actually dictates a $50 liability limit, but most if not everyone just drops it all the way to $0).

You really should just quit posting, you're embarassing yourself but you're too stubborn to realize it.

Viper GTS

You say that the protections aren't company specific and then say it's up to the company to lower your liability from 50 to 0.

Also,

http://www.ftc.gov/bcp/conline/pubs/credit/atmcard.shtm

Your protection for a debit card is actually the same for a CC as long as you report it within 2 business days.

http://www.pirg.org/consumer/banks/debit/fact.htm

This link explains exactly what I said in the post you quoted...

2. QUICK FACTS: WHY ATM DEBIT CARD PROBLEMS ARE WORSE THAN CREDIT CARD PROBLEMS AND PIRG'S RECOMMENDATIONS

(1) YOUR LIABILITY IS GREATER THAN WITH A CREDIT CARD: The law limits consumer liability for credit card fraud to $50. For debit card fraud, your liability is $50 if you notify the bank with 2 days of learning of the fraud, and $500 or more after two days, up to the entire amount stolen under certain circumstances.

 

[Beattie]

Another point is that identity thieves are much more likely to target someone with a high fico score as it's easier for them to get more money in your name. Now, you aren't liable for the money but you still have to spend the hours/days finding all of the fraud that was committed, filing police reports, contacting lenders, and making sure it was all cleaned up properly.

 

[PKPunk]

I'm with 90% of people in the thread get a credit card. It's good to have just in case of an emergency when you need money you can't back with cash. Imagine how nice it would be to have a credit card when you have 1000 dollars in car repairs but you only have 500 cash.

The first credit card I got a was a crappy student card with weak 200 dollar limit. I maxed the thing out almost every month buying food, gas, etc. I later got a card with 500 dollar limit and stopped using my first card. I stopped using the first credit card, I haven't used it in over 6 years but I haven't canceled it. They keep raising the limit and issuing me new cards. I think it's current limit is at 3600 maybe more. I think keeping a credit card, even if you don't use it still builds credit. I think I have about 6 credit cards right now and I only use 1 of them. My credit score is at 725 or 735 last time I checked. I've never had a car loan or home loan either.

 

[QueBert]

no credit = a credit risk, maybe Beattie did find one off the wall lender who looked at him having no credit history as a good thing and gave him the same rate my GF who has an 815 score would get. But come on there's no way that's the normal, or even close. I'm a high school drop out who only has a GED and my common sense tells me this is ludicrous.

Higher FICO score = better credit rates, it's not complicated. Now people who say they have no credit and get the same rates as those with super high credit scores, I find that confusing.