credit

[Fast Fords]

so what do you guys think about credit cards? I know you need one to get a house/buy a car (with a credit history). My bank offered me one last night up to $3000 ( for a 19 y/o thats pretty decent) and i haven't decided between 1 or 2 grand to set as my limit.

here are the basic rules i have found on credit cards, in no particular order:

#1 - be safe with your card. make sure you are protected

#2 - insurance isn't a bad idea

#3 - don't spend more than you can pay back in any given month

#4 - under NO circumstances shall you EVER give your credit card to your GF/wife/girl that is your friend.

 

[colinrmitchell]

#4 sounds like the best plan to follow!

I have a couple cards, and I agree that I never put more on them then I could pay back by the end of the month. I usually never use them, except to pay for tuition or big truck parts at Summit Racing.

I've heard somewhere about not having a balance on a card that is more than 10% of the credit line.

 

[racinranger]

Credit is a fickle mistress my friend! so many things to watch out for. Those rules you set out are good but you may still get into trouble. watch out for balloon interest rates like special offers with no payments for 2 years and shit. if you miss that first payment they'll hit you with ALL the interest accrued over the 2 year period, and yea that will suck. Another thing to look for are cards with annual charges just to hold the card and interest rates that change with prime or purchase types.

 

[Evan]

so what do you guys think about credit cards? I know you need one to get a house/buy a car (with a credit history). My bank offered me one last night up to $3000 ( for a 19 y/o thats pretty decent) and i haven't decided between 1 or 2 grand to set as my limit.

here are the basic rules i have found on credit cards, in no particular order:

#1 - be safe with your card. make sure you are protected

#2 - insurance isn't a bad idea

#3 - don't spend more than you can pay back in any given month

#4 - under NO circumstances shall you EVER give your credit card to your GF/wife/girl that is your friend.

With a true credit card you don't need to worry about insurance or protection. All credit cards are protected by federal law as far as theft and unauthorized expenditures. ATM/debit cards can be a different story.

 

[Fast Fords]

well, the interest rate is 10.76%, and an annual fee of $5. Its just TD's (my bank) simplest, most straight forward credit card. I have a credit card right now of $300 from a department store, but i rarely use it as the interest is a nut-wrenching 26%!

 

[rboyer]

You don't need one to buy a house. I just bought a house and my credit report is completely blank. I never borrowed money before in my life and never had any outstanding debt. They look more at the bad stuff on your report than the good.Now everything else is a different story. I have used a company cell phone for years and after getting a new job recently I went down to at&t to set up an account.They demanded a $500 deposit. Borrowing money for a house was easier than getting a cell phone.

 

[martin]

I took my credit cards and cut them into little pieces and threw them away. That was twenty five years ago. Renting a car is impossible without one unfortunately.

 

[Jspafford]

Find one without a yearly fee. There are MANY out there. No sense in paying it when you don't have too.

Now, I have credit cards. I have about 8 of them. They are all, with the exception of a gas card, locked in a safe. I owe a balance on one of them from buying contents for the new house, it will be paid off by the end of the year.

I won't go into specifics, but if I totalled up the 8 cards credit limits, I have over 100K in available credit I could use.

I will never use it, but it looks bad to close them, so I just keep em locked up.

 

[Plum Ranger XLT]

I have one credit card and that is enough for me and I use it only for big purchases.

 

[superdave1984]

I don't have a credit card, just my bank debit card. I can do whatever I need with it. Best advice is not to use a credit card except for emergencies or purchases you CAN pay off in full when the bill comes.

 

[Nipplechops]

Get a line of credit. It will save you a ton of money in the end. Credit cards are a waste of money if you plan on carrying a balance. Most don't plan on it that way, but 99% of the time that's the way it ends up.

If you can't pay cash, then you really don't need it that bad.

 

[Sevensecondsuv]

Rule number 3 was the most important. There is never any reason to carry a balance on a CC. If you need a loan for something (like school, house, etc) there are plenty of conventional loan options with a FAR lower interest rate. If you feel the need to buy something more than you can pay cash for but you can't get a real loan for (like a lift kit and big tires for your ranger) then you simply must not buy them. Only a fool carries a balance on a CC.

Credit cards are not inherantly evil, mysterious, and certainly do not posess any special power to put their owner into debt. Just use common sense, don't buy things you couldn't pay cash for, and most importantly pay the balance in full each month.

I would look for a different card. Mine is a Chase BP Visa card. I get 5% back on BP gasoline purcheses, 2% back on travel and dining, and 1% back on everything else. Plus there is no annual fee. I use it to buy gas and for most of my other weekly/monthly purchases. I pay the balance in full every month. In 8 months of use I've racked up about $200 in cash back rewards, all from a card that costs me $0.00 to use. So in my sense, using the card is a no brainer.

And to the guy that said a bank card is just as good: That's not true. Try renting a car out of state with a bank card. They won't let you. Bank cards are also not credit, so they don't build a credit rating, making it much harder (note not impossible) for you to buy a house some day.

 

[v-8power]

Having a credit card with say, 5000.00 limit on it without a balance will hurt you more then anything when buying a house. They are afraid of you going out and maxing it out after you recieve your loan. At least this is what we were told when we bought our first house.

 

[Jspafford]

Having a credit card with say, 5000.00 limit on it without a balance will hurt you more then anything when buying a house. They are afraid of you going out and maxing it out after you recieve your loan. At least this is what we were told when we bought our first house.

I had over 100K available credit on MANY cards and I just bought a house for over $100,000 in my name alone.

They never even mentioned my credit cards... Now if you want a personal loan, the credit cards will kill your chances.

 

[samsonitesamsonite]

My credit rating is so low its not even funny. And I don't care. BECAUSE I don't borrow money. period. The best way to do it is have NO debt. 0. zilch. nadda.
Cars? Only buy a car you can pay cash for.
You don't have to have good credit to get a good loan for a house, I don't have the literature in front of me right now, but good lendors that actually go by lifestyle and not some stupid number can look at things. The best way to do it is live well below your means for 3-5 years and buy a house outright.