Comments on: An Imperfect Credit Score is Not the End of the World http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/ personal finance that makes cents Tue, 07 Oct 2008 23:24:47 +0000 http://wordpress.org/?v=2.5.1 By: Roy http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94413 Roy Sat, 04 Aug 2007 10:43:27 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94413 I agree with Moneymonk, with the additional observation, that a credit score still means nothing when one buys a used car with cash. Credit score is really only good for borrowing money, secured or unsecured and that part of my life is over. I don't miss credit cards, the mortgage, or the car payment. I pay my bills on time, and my house is all mine. I don't really care if someone thinks that I'm bad for not doing the unsecured credit thing. My overhead is obscenely low compared to anyone else who is borrowing money and I just love it. I agree with Moneymonk, with the additional observation, that a credit score still means nothing when one buys a used car with cash.

Credit score is really only good for borrowing money, secured or unsecured and that part of my life is over. I don’t miss credit cards, the mortgage, or the car payment.

I pay my bills on time, and my house is all mine. I don’t really care if someone thinks that I’m bad for not doing the unsecured credit thing. My overhead is obscenely low compared to anyone else who is borrowing money and I just love it.

]]> By: Dan http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94297 Dan Fri, 03 Aug 2007 12:40:24 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94297 I started trying to get my credit score up when I worked as a loan officer while in college. It was 650 at the time. I'm now 25 and my credit score when I signed my lease on my new apartment was 826. All I did was the following: - Try to keep your balance to available credit at 30%. - Pay off the balance on all revolving credit every month. - Keep a few different credit cards, but cut them up when they send new ones, using only one or two. I started trying to get my credit score up when I worked as a loan officer while in college. It was 650 at the time.

I’m now 25 and my credit score when I signed my lease on my new apartment was 826.

All I did was the following:

- Try to keep your balance to available credit at 30%.
- Pay off the balance on all revolving credit every month.
- Keep a few different credit cards, but cut them up when they send new ones, using only one or two.

]]> By: NW-Woman http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94170 NW-Woman Thu, 02 Aug 2007 16:48:31 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94170 What's horrific to me is that one can have perfect payment histories and STILL have a low credit score. I just checked mine on Experian. It says I am a high risk -- not the highest, mind you, but second from the bottom rung! It also shows I have a perfect payment history. I have zero liens, bankruptcies, etc. Totally clean. I have three credit cards and two store cards. One credit card has a balance on it that is 900. The limit on that card is 5000. I have paid off my mortgage and car loan long ago. That appears to be a problem! What is one to do? What’s horrific to me is that one can have perfect payment histories and STILL have a low credit score. I just checked mine on Experian. It says I am a high risk — not the highest, mind you, but second from the bottom rung! It also shows I have a perfect payment history. I have zero liens, bankruptcies, etc. Totally clean. I have three credit cards and two store cards. One credit card has a balance on it that is 900. The limit on that card is 5000. I have paid off my mortgage and car loan long ago. That appears to be a problem! What is one to do?

]]> By: LivingReal Steve http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94158 LivingReal Steve Thu, 02 Aug 2007 12:52:20 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94158 By no means is that true Minimum Wage. Credit scores are as much a part of good faith as paid off balances. Staying in contact with your creditors is crucial and making promises you can keep (in all areas of Life) is major. Call each of your creditors, arrange a payment that you can make (even if it is $5 a month) and stick to it - each and every month. They will no doubt balk (the minimum wage worker in the credit department, which is their job) but stick to your objective, state your plan to send $xx.xx per month and stick to it. Credit reports record payment history. In a few months your report will show you making regular payments and things start to look rosier. Its not an overnight endeavor - it takes time. In the meantime - figure out how you are going to deal with the minimum wage mentality. Even if a person's income is low, how they live life doesn't have to be. - Enjoy! Steve www.LivingReal.net By no means is that true Minimum Wage. Credit scores are as much a part of good faith as paid off balances. Staying in contact with your creditors is crucial and making promises you can keep (in all areas of Life) is major.
Call each of your creditors, arrange a payment that you can make (even if it is $5 a month) and stick to it - each and every month. They will no doubt balk (the minimum wage worker in the credit department, which is their job) but stick to your objective, state your plan to send $xx.xx per month and stick to it.
Credit reports record payment history. In a few months your report will show you making regular payments and things start to look rosier.
Its not an overnight endeavor - it takes time. In the meantime - figure out how you are going to deal with the minimum wage mentality. Even if a person’s income is low, how they live life doesn’t have to be. - Enjoy!

Steve
http://www.LivingReal.net

]]> By: LivingReal Steve http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94157 LivingReal Steve Thu, 02 Aug 2007 12:51:20 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94157 By no means is that true Minimum Wage. Credit scores are as much a part of of good faith as paid off balances. Staying in contact with your creditors is crucial and making promises you can keep (in all areas of Life) is major. Call each of your creditors, arrange a payment that you can make (even if it is $5 a month) and stick to it - each and every month. They will no doubt balk (the minimum wage worker in the credit department, which is their job) but stick to your objective, state your plan to send $xx.xx per month and stick to it. Credit reports record payment history. In a few months your report will show you making regular payments and things start to look rosier. Its not an overnight endeavor - it takes time. In the meantime - figure out how you are going to deal with the minimum wage mentality. Even if a person's income is low, how they live life doesn't have to be. - Enjoy! Steve www.LivingReal.net By no means is that true Minimum Wage. Credit scores are as much a part of of good faith as paid off balances. Staying in contact with your creditors is crucial and making promises you can keep (in all areas of Life) is major.
Call each of your creditors, arrange a payment that you can make (even if it is $5 a month) and stick to it - each and every month. They will no doubt balk (the minimum wage worker in the credit department, which is their job) but stick to your objective, state your plan to send $xx.xx per month and stick to it.
Credit reports record payment history. In a few months your report will show you making regular payments and things start to look rosier.
Its not an overnight endeavor - it takes time. In the meantime - figure out how you are going to deal with the minimum wage mentality. Even if a person’s income is low, how they live life doesn’t have to be. - Enjoy!

Steve
http://www.LivingReal.net

]]> By: Minimum Wage http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94145 Minimum Wage Thu, 02 Aug 2007 05:34:33 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94145 So since my credit is in the tank (health/hospital/loss of income) and I can't get it out of the tank on a minimum wage income, I guess I'll never have credit again, I'll always have to pay up the wazoo for car insurance (even though I have an excellent driving record), and I'll just be broke the rest of my life. Got it. So since my credit is in the tank (health/hospital/loss of income) and I can’t get it out of the tank on a minimum wage income, I guess I’ll never have credit again, I’ll always have to pay up the wazoo for car insurance (even though I have an excellent driving record), and I’ll just be broke the rest of my life. Got it.

]]> By: LivingReal Steve http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94125 LivingReal Steve Wed, 01 Aug 2007 20:57:25 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94125 Keeping up on your credit report is important for another reason - false information and identity theft. Since the input of data is done by people we must accept the reality that mistakes can happen. Also is the reality of others using your personal information for their own benefit which can lead to a destruction of your own credit report. The sooner this is caught and dealt with the easier it is to fix. Since the law requires each of the three credit reporting bureaus to allow you one free annual report each it would be wise to set up a reminder to check one of the 3 agencies every 4 to 6 months. You can access this free option at https://www.annualcreditreport.com you certainly should be aware of what others can find out about you before they do. Steve@livingreal.net www.livingreal.net Keeping up on your credit report is important for another reason - false information and identity theft.
Since the input of data is done by people we must accept the reality that mistakes can happen. Also is the reality of others using your personal information for their own benefit which can lead to a destruction of your own credit report. The sooner this is caught and dealt with the easier it is to fix.
Since the law requires each of the three credit reporting bureaus to allow you one free annual report each it would be wise to set up a reminder to check one of the 3 agencies every 4 to 6 months. You can access this free option at https://www.annualcreditreport.com

you certainly should be aware of what others can find out about you before they do.
Steve@livingreal.net
http://www.livingreal.net

]]> By: Dancinghawk http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94102 Dancinghawk Wed, 01 Aug 2007 15:27:22 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94102 I'm one of those people that is a bit too invested in getting my credit score to the highest possible level -- and it's high enough that it doesn't restrict me now. But it is worth it to be aware of financial obligations that are based on your credit score -- I recently got my car insurance dropped by $120 because I had them re-run a credit check on me and adjust my payments, since I knew it had gone up from when I was last evaluated. I had to specifically call the insurance co.'s credit department to accomplish this; it's not like they do it on their own. And as far as I can tell (since I'm apartment hunting) pretty much all rental places, at least in my area, run credit checks prior to approving a rental application. The only reason I can think that I actually need a credit score over 800, though, is for the ego boost, but I am impossibly competative. I’m one of those people that is a bit too invested in getting my credit score to the highest possible level — and it’s high enough that it doesn’t restrict me now.

But it is worth it to be aware of financial obligations that are based on your credit score — I recently got my car insurance dropped by $120 because I had them re-run a credit check on me and adjust my payments, since I knew it had gone up from when I was last evaluated. I had to specifically call the insurance co.’s credit department to accomplish this; it’s not like they do it on their own.

And as far as I can tell (since I’m apartment hunting) pretty much all rental places, at least in my area, run credit checks prior to approving a rental application.

The only reason I can think that I actually need a credit score over 800, though, is for the ego boost, but I am impossibly competative.

]]> By: Minimum Wage http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94067 Minimum Wage Wed, 01 Aug 2007 05:09:17 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94067 Seven years? It ain't necessarily so. I have a 20-year-old tax lien still on my report; the seven-year clock won't ev en start until it is resolved. Also I have a creditor judgment which can be renewed, so it won't go away after seven years either. Seven years? It ain’t necessarily so. I have a 20-year-old tax lien still on my report; the seven-year clock won’t ev en start until it is resolved. Also I have a creditor judgment which can be renewed, so it won’t go away after seven years either.

]]> By: CatWhisperer http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94066 CatWhisperer Wed, 01 Aug 2007 04:52:39 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94066 As the post indicated, service providers other than creditors have tried to use credit scores to evaluate the risks of doing business with individuals. For example, insurance providers might perceive a correlation between credit risk and an individual's insurable risk profile against which they intend to write a policy. How strong a correlation and whether there is also a relationship of cause and effect, or a relationship of common cause, may not be factored in so rigorously, at least not while obtaining the credit score is cheaper than creating and evaluating a risk profile appropriate to the business relationship, but from scratch. Using the credit score across vertical market lines makes the 'credit score' a 'quality as a person' score. If this idea doesn't give you a chill, it sure should. As the post indicated, service providers other than creditors have tried to use credit scores to evaluate the risks of doing business with individuals.

For example, insurance providers might perceive a correlation between credit risk and an individual’s insurable risk profile against which they intend to write a policy. How strong a correlation and whether there is also a relationship of cause and effect, or a relationship of common cause, may not be factored in so rigorously, at least not while obtaining the credit score is cheaper than creating and evaluating a risk profile appropriate to the business relationship, but from scratch.

Using the credit score across vertical market lines makes the ‘credit score’ a ‘quality as a person’ score. If this idea doesn’t give you a chill, it sure should.

]]> By: Money Smarts » Can corruption jack up the price of your pansit? http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94062 Money Smarts » Can corruption jack up the price of your pansit? Wed, 01 Aug 2007 03:24:28 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94062 [...] bloggers: Get Rich Slowly has an answer for Peter who is worried about his credit score (well, in a way). Yeah, its not the [...] [...] bloggers: Get Rich Slowly has an answer for Peter who is worried about his credit score (well, in a way). Yeah, its not the [...]

]]> By: Anon http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94043 Anon Wed, 01 Aug 2007 00:16:39 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94043 Don't some rental apartments check the FICO score before approving a rental agreement? Don’t some rental apartments check the FICO score before approving a rental agreement?

]]> By: Moneymonk http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94017 Moneymonk Tue, 31 Jul 2007 20:20:44 +0000 http://www.getrichslowly.org/blog/2007/07/31/an-imperfect-credit-score-is-not-the-end-of-the-world/#comment-94017 There were only 2 times in which my score was important to me. Buying a house Buying a car other than that, I really did not care. If you are the type that often borrow money. I guess you would be more obsessive. I don't borrow often. So I am not FICO crazy There were only 2 times in which my score was important to me.

Buying a house
Buying a car

other than that, I really did not care. If you are the type that often borrow money. I guess you would be more obsessive.

I don’t borrow often. So I am not FICO crazy

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