Sunday, November 21, 2010

Is building credit score important? Mom said NO and GF said YES?

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Is it important to build my credit score?? mom said no, gf said yes.?

I am 22 years old, I never had any credit history (credit card, phone bill, etc).

How important is it to build my credit?

My mom said ';you do not need to get credit, just pay with what you have when you have it';

My GF: ';its very important that you build your credit score, especially if you want to get a house and other things in the future';

So what should I do? WHo is more correct??

thanksIs building credit score important? Mom said NO and GF said YES?
Building your credit is very important. Your ability to borrow money from banks in the future depends on your credit.Is building credit score important? Mom said NO and GF said YES?
I think building a credit is very important to every one. Sometime you may need a credit rating in the future for reference for something.
Boy, I hate to go against Mom, but in this instance your GF is correct. For way more reasons than she stated however. Future house purchases are just the icing on the credit cake. More and more employers are judging applicants at least partially on their credit score. Insurers base more than half of the decision to insure you and what your rates will be based on your credit score. Renting an apt, you guessed it, based on credit score.

Can you get utilities, cable, internet or a cell phone in your name... again, credit score.

Apply for a credit card. Charge your gasoline only. Pay the bill in full at least a week before it's due. After 6 months or so, apply for another credit card. Use it to buy lunch or breakfast once every other week. Pay the bill off in full. 6 months later... ETC.. After you have the oldest card for a year, ask to have the limit increased by $1000. Continue the pattern until you have 5 cards. Jsut make a small charge each month on each of the other cards. Less than $10. Pay them off early each month. Try to get them all issued by different banks if possible. You don't want all Chase cards for example. The application should say who backs the card you are applying for.

Here's why. Lets say your card has a $500 limit. You absolutely never want to have more than $100 charged on it ever. 20% would be the self imposed limit. This makes your credit useage ratio optimal. The ratio is 35% of your score. Payment on time is 35% and the rest is a bunch of other stuff. With 70% of your score being just those 2 things, you can see why they are important. Obviously the higher your limit on each card, the better your ration will be. The key to all of this is to absolutely never charge more than you can pay off at least a week before the payment is due.

By following this formula you will have an outstanding credit score in about 2 - 3 years and you'll be elligible for the best financing rate on any car or home that you can afford to purchase.

I hope this helps. If so, be sure to vote for me.
If you ever want to buy a house or car with a loan, or get a loan for anything, or even rent an apartment, they'll check your credit and want to see a good score. You'll need a good credit rating to get utilities turned on for somewhere you live without a huge deposit. Some jobs even check it before extending offers. So I'd say in this case, mom does NOT know best - 50 years ago she'd have been right or close to it.

But where mom IS right - don't get in over your head, and if you have a credit card, pay it off every month.
well shes just looking out for you because credit cards for the wrong people are a bankers best friend. your just spending money you don't have which is considered in the Bible as greed. Also look out for high interest rates. lol but yes its nice for you to buy a house and car which are needed in this day and age but obsessive shopping and useless debauchery are sin.

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