How to build a credit score

In reply to 16vCorey:

It's a bit of a case of sounding a bit "uppity" when you say you're 36 years old and have a paid off house - but don't go into any detail about how you did that. I'm 43 and single with a paid off house, but I freely admit my situation is lucky and uncommon and shouldn't be used for purposes of comparison in these types of discussions.

Personally, I agree with having some credit cards. I have 3 I use often. Two - a Master Card and Discover - I've had for a long time; '92 and '94. The latter is used for most purchases, the former for subscription payments (e.g. Netflix) and for the occasional store that doesn't take Discover. I also have a Visa card with a special 5% cash-back off fuel purchases (applied directly to the monthly statement), so it's only used for that. All are paid off every month (except when I eff up and accidently pay the wrong card, but that's a different issue)

I've had problems with using cards responsibly in the past, but fortuntely I've been good for the last 10 years or so. I've had a number of car loans I've paid off as well as two personal bank loans. When I bought the minivan last month, I asked for a 2 year loan, but the shortest they would give is 3 years. The rate (a bit under 3.5%) isn't too bad for a used car loan and considering the price of the van (under $10K), the final interest paid won't bother me much.

The only reason I bought the house on contract was because I couldn't get funding for it, and not because of bad credit, it was because I was self-employed the previous two years, and had just started a different job when I was applying. They said my income wasn't consistent enough over the last two years, or something like that. And I knew the seller (not related, but someone I could trust), so I wasn't worried about it getting foreclosed on.

And I completely agree with using free or cheap money. I'm actually about to get a loan for some foundation repairs that I could afford outright (albeit pretty tightly), but with putting the house on the loan the interest is so low that I'd rather keep my money where it's at. Actually I just opened a Macy's card because they gave me 20% off of a fairly expensive necklace I bought my wife for christmas, but I plan on paying that off as soon as I get the statement and closing the account, so I have no problem with using credit to your advantage!

I was honestly just wondering if there were other reasons to worry about credit that I wasn't seeing.

Your car insurance, job opportunities, etc.

I'd hate to think of the scenario where I'd need to, but it's also nice to know, I have deep into 5 figures of available credit line at any given time.

Ian F wrote: In reply to 16vCorey: It's a bit of a case of sounding a bit "uppity" when you say you're 36 years old and have a paid off house - but don't go into any detail about how you did that. I'm 43 and single with a paid off house, but I freely admit my situation is lucky and uncommon and shouldn't be used for purposes of comparison in these types of discussions.

That was not my intent, so I apologize if it was taken that way. I'll completely admit I was a bit lucky too, since if the seller hadn't agreed to sell it on contract I probably wouldn't have been able to buy it at the time. I found a nice fixer-upper house for $40k in a pretty nice neighborhood, put $5k down and paid $500 a month until it was paid off. After some money and a lot of work, it's probably worth $80k or so now.

But that doesn't really have jack squat to do with the discussion at hand. I really just wondered if I should be concerned with my credit score at this stage in my life, and tried to explain where I was at. That's it.

16vCorey wrote: But that doesn't really have jack squat to do with the discussion at hand. I really just wondered if I should be concerned with my credit score at this stage in my life, and tried to explain where I was at. That's it.

You asked for other areas where it could affect you that you weren't seeing.

Hence my reply.

z31maniac wrote:

16vCorey wrote: But that doesn't really have jack squat to do with the discussion at hand. I really just wondered if I should be concerned with my credit score at this stage in my life, and tried to explain where I was at. That's it.

You asked for other areas where it could affect you that you weren't seeing. Hence my reply.

I should have clarified, your last response did in fact apply to the convo! And I appreciate it! That was actually in response to Ian F saying that I sounded "uppity" and criticizing me for not giving an explanation on how I paid off my house. That's the part that had nothing to do with the topic at hand.

Sorry for the derailment! Carry on.