rogdan
Gold Member
I think it goes to far when potential employers ask to check your credit rating on applications.
Value of credit rating
- Thread starter reb
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I find it interesting that credit scores can affect such a wide ragne of purchases and companys views about your lifestyle...although I must say in my experience I believe they are right. Most people that I have come across that have great credit are stand up people who can be trusted...thats not to say that people who don't have good credit are the opposite, thats obviously not the case.
Here is a good story that I can tell from a dealer standpoint...
Last summer had a gentlemen come in and want to purchase at Cub Cadet utility vehicle. Had him fill out the credit form, he went to look around the machine a little more while I stayed in the office and called it in. Now here is the good part, he put that he makes $315,000.00 per year. I thought I would have an easy sale on my hands. Me and the lady that was taking the credit app. information were joking about wishing we made that much money, etc. Well long story short he was denied. The lady said he had more money going out than he had coming in...I cannot fathem having more than $315,000.00 a year going out!!!! Makes me wonder how someone who is making that much money can't make good financial decisions?!?!
Here is a good story that I can tell from a dealer standpoint...
Last summer had a gentlemen come in and want to purchase at Cub Cadet utility vehicle. Had him fill out the credit form, he went to look around the machine a little more while I stayed in the office and called it in. Now here is the good part, he put that he makes $315,000.00 per year. I thought I would have an easy sale on my hands. Me and the lady that was taking the credit app. information were joking about wishing we made that much money, etc. Well long story short he was denied. The lady said he had more money going out than he had coming in...I cannot fathem having more than $315,000.00 a year going out!!!! Makes me wonder how someone who is making that much money can't make good financial decisions?!?!
Gamble,
It's like one of the commercials on the tube now. The guy is in front of his huge home, new cars, pool, kids, etc, and says "How do I do it? I in DEBT up to my eyeballs!"
Well, duh. Spend more than you make, or plan on more than you reasonably expect to earn, and you are in hock!
In the early 90's, I was at my credit union applying for a vehicle loan. It breezed through. Out of curiosity, I asked them what the max was they'd loan me for a vehicle. $50,000 was the answer. That was about two and a half times what I wanted to borrow!
I laughed and exclaimed "ARE YOU NUTS?" According to them, I was good for it, but no way would I put that much strain on our spending..............
ron
It's like one of the commercials on the tube now. The guy is in front of his huge home, new cars, pool, kids, etc, and says "How do I do it? I in DEBT up to my eyeballs!"
Well, duh. Spend more than you make, or plan on more than you reasonably expect to earn, and you are in hock!
In the early 90's, I was at my credit union applying for a vehicle loan. It breezed through. Out of curiosity, I asked them what the max was they'd loan me for a vehicle. $50,000 was the answer. That was about two and a half times what I wanted to borrow!
I laughed and exclaimed "ARE YOU NUTS?" According to them, I was good for it, but no way would I put that much strain on our spending..............
ron
midlf
Platinum Member
When we were shopping for the place we have now I asked my bank for a preapproval letter. It came through with a number on it I could not believe. I called and asked if that was correct. They said it was. I told them they were nuts, I would never go into hock for that much. Their answer was the same, that I could have what I wanted because my ratings indicated I would not ask for more than I could afford.
It is easy to see how some people can get into trouble. I would never have wanted to have a credit limit like I have now when I was married to the starter wife. Of course if I was still married to her I would not have a good credit score.
It is easy to see how some people can get into trouble. I would never have wanted to have a credit limit like I have now when I was married to the starter wife. Of course if I was still married to her I would not have a good credit score.
Bird
Rest in Peace
Yep, Ron & midlf, these financial organizations seem to think I can afford a LOT more than I think I can afford. In 1991, while we were full time RVers living in a fifth-wheel trailer, we happened to be in Las Vegas and saw a new motorhome we thought we'd like to have, so we stopped to visit with a salesman and I told him I'd like to take it out for a test drive. And we did. While I was driving it around, the salesman and I finally reached an agreement on price, but I told him they'd have to remove the outside mirrors and replace them with a particular kind of power and heated mirrors, replace a vent with a power vent, put extensions on the dual tire valve stems, install a good CB/weather radio, etc. When we returned to the dealership and I started to park it on the lot, he told me to just drive it on back to the service department. He got out and went to telling the service writer to do all the things I'd mentioned, and I told him to hold on a minute. The last time I financed anything, I was gainfully employed and making more money than my pension, so he'd better check to see if he could get the kind of financing I wanted (I'd told him the term and maximum interest rate I'd accept). He said, "Oh, I've already checked your credit rating and they're going to finance whatever you want." /forums/images/graemlins/shocked.gif
</font><font color="blue" class="small">( Gamble,
It's like one of the commercials on the tube now. The guy is in front of his huge home, new cars, pool, kids, etc, and says "How do I do it? I in DEBT up to my eyeballs!"
)</font>
Thats actually one of my favorite commercials. It perfectly describes a large portion of our population... These are generally the same folks that cant stand the idea that the government wants to make banrupsy more difficult.. If you dont put yourself in that possition, welfare and bankrupsy are not an issue.. Get a job, live within your means and enjoy... /forums/images/graemlins/grin.gif Thats my theory, I learned my lesson avoiding bankrupsy...
It's like one of the commercials on the tube now. The guy is in front of his huge home, new cars, pool, kids, etc, and says "How do I do it? I in DEBT up to my eyeballs!"
)</font>
Thats actually one of my favorite commercials. It perfectly describes a large portion of our population... These are generally the same folks that cant stand the idea that the government wants to make banrupsy more difficult.. If you dont put yourself in that possition, welfare and bankrupsy are not an issue.. Get a job, live within your means and enjoy... /forums/images/graemlins/grin.gif Thats my theory, I learned my lesson avoiding bankrupsy...
BB_TX
Veteran Member
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There was an interesting article (on msn.com I think) about the subject of canceling a credit card and it affecting your credit rating. It goes like this. If you had 3 credit cards, line of credit of $5000 each, for a total line of credit of $15,000 and you owed a total of $5000, then you would have $10,000 credit available to use. If you canceled one card, you would only have a line of credit of $5000 available to use. To the credit score it appears you have suddenly become less credit worthy. Reality doesn't come in to play here. /forums/images/graemlins/confused.gif
heehaw
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the bad part is, this relative of mine that is going to have to pay outragous prices for homeowners insurance, has bad credit, because the co they worked for shut down and moved to mexico: they had a rent house they had borrowed $30k on, and they lost it...now they work 2 part time jobs at just barely above minimum wage: and are getting the shaft again.
i cancelled 2 credit cards last year, when i retired: was using one because it gives me 5% back on gas purchases: up to a max of $300 a year: so i requested another cc from the same co. to double the 5% refund, at the recommendation of the folks at the cc company: when i filled you the application, i put down that i earned about half of what i actually earn: so i got a card with a $500 limit...the joke is on me...
heehaw
i cancelled 2 credit cards last year, when i retired: was using one because it gives me 5% back on gas purchases: up to a max of $300 a year: so i requested another cc from the same co. to double the 5% refund, at the recommendation of the folks at the cc company: when i filled you the application, i put down that i earned about half of what i actually earn: so i got a card with a $500 limit...the joke is on me...
heehaw
midlf
Platinum Member
Just use that $500 limit card and keep paying the balance each month. I suspect you will be surprised by how fast the limit gets raised.
2nstonge
Gold Member
Another thing to watch for is when the CC company bumps up your limit without asking, you get the letter "congratulations, becuase of your outstanding payment record we've raised your limit to $25,000 - and here's some convenience checks so you can start spending today".
2 of my CC's did this to me within weeks of each other, I thought nothing of it. I didn't even use the extended limit and the bank that holds my mortgage and equity line bumped up the interest rate on our equity note because it suddenly looked like we were over extended (the amount of credit available to you - whether you use it or not - impacts your credit score). In the banks eye I had the potential of another $15,000 in CC debt available to me which "might" impact my ability to pay the bank note thus I was considered a higher risk. You can't imagine what a PITA it was to get the CC companies to DECREASE my credit limit and provide a letter for my bank stating it was done at my request!
-Norm
2 of my CC's did this to me within weeks of each other, I thought nothing of it. I didn't even use the extended limit and the bank that holds my mortgage and equity line bumped up the interest rate on our equity note because it suddenly looked like we were over extended (the amount of credit available to you - whether you use it or not - impacts your credit score). In the banks eye I had the potential of another $15,000 in CC debt available to me which "might" impact my ability to pay the bank note thus I was considered a higher risk. You can't imagine what a PITA it was to get the CC companies to DECREASE my credit limit and provide a letter for my bank stating it was done at my request!
-Norm