<p>Check Myfico forums for the reasons if trying to establish credit. If you have good credit not a problem, if you have no credit history or trying to improve, you keep your use low, meaning scores will not move if you don’t actively use your card. My example of $20 dollars was to show use, so that activity is reporting on your report not to say perpetually carry balance on card. </p>
<p>If the person can’t get a card, or is tied into a secured card, they have to use the card, paying it off every month is the only way to get a high score.</p>
<p>The free credit reports only show what accounts are favorably reporting or derogatory accounts, no score is given.</p>
<p>Credit reports don’t show your balance but credit/loan/mortgage companies see what your debt to available credit used. All of which determines your credit score.</p>
<p>Credit card company or banks do not look favorably using more than 20% of available credit.</p>
<p>S was always credit averse as well. Perhaps it was helpful that we added him to my CC when he started college as an authorized user (as we added D). We figure it’s good for them to have an emergency card, “just in case.” They’ve rarely used it & prefer to stick with their debit cards.</p>
<p>S was still offered a Gold AmEx with 2 years no fee when he graduated & started his 1st job. He recently got his first rejection when he applied for 2 credit cards within a week of each other. He applied for the 2nd (rejected) one slightly later & was able to get it, I believe. </p>
<p>Congrats, Garland on your D finding a home & being able to get good financing for it.</p>
<p>MyFICO charges you after your 10 day “free trial” period. Please be aware. You have to decide if you think it’s worth it & you can start with your free credit report before you decide if you want to pay any money to ANYONE.</p>
<p>Thanks, Himom! D and BF are both maniacal savers, and both credit averse, and managed to find the lowest price house (I think) in the town they want to live in. Since their salaries are quite modest, people we know are amazed that they can afford this town. Great schools, great location, all kinds of amenities. But the house is in the “poorer” corner of town (where they’re more comfortable, anyway.) I couldn’t be happier for them.</p>
<p>Our hope is that one day, our kids will be able to find a place they love where they can purchase. Having just helped a friend through yet another move downsizing, I really feel for folks who have to move frequently because of landlord issues, among other things.</p>
<p>Great that your D & BF were able to find a place in a great location, since that’s pretty much everything! They may be able to fix it up if their income permits after they’re well-settled.</p>
<p>Thanks for your clarification, samiamy. Free forums with GOOD advice can be useful–as is CC. There are lots of sites that advise people to have a balance or take out a loan to improve their credit scores–that isn’t necessary and could actually have a negative impact (tho of course being good for the lenders).</p>
<p>However, it does allow checking to see if your credit report has errors or fraudulent accounts in it. Errors are quite common, especially if you have a common name (the credit reporting companies have a tendency to combine the reports of two people with the same or similar names into one report).</p>
<p>The credit reporting companies are pretty odd about what they put into the report sometimes. We rented our own apartment but because the rent was so low, they always wrote that we were living with family for the first many years of our marriage. Since we always got whatever we wanted and that erroneous info didn’t seem to affect us, we never bothered to correct it or any other errors we noticed on the report.</p>
<p>A few years ago when we got our HELOC, we were informed that H’s credit score was about the max possible & mine was slightly lower (more CCs were recently approved in my name & perhaps I had closed an account or more). Knowing one’s credit score isn’t all that crucial except for folks who are or soon may be shopping for financing or have been turned down for credit (e.g. credit card, mortgage, loan).</p>
<p>I’m curious about something (not that it’s any of my business, so I won’t be offended if told to MYOB.) I understand why a young adult would be concerned about her FICO score if she expects to take out a loan for a house or car in the future. What I don’t understand is why an older (not old, just parent of college student age) adult would care about credit scoring if he or she doesn’t have a mortgage and has no plans to go into debt again. </p>
<p>So, am I missing something? Should I care about my FICO score?</p>
<p>Silpat, I’m in the same financial situation as you, and I care about my FICO score because credit scores are used for insurance pricing, employment checking, all sorts of things and increasingly so. I don’t intend to be seeking a new job or house in the future, but you just never know what the future holds…</p>
<p>Not only do they look at the debt ratio of your credit but they also look at how long your credit lines have been open. She is young and shouldn’t have closed those lines of credit - even if she’s not using them she should keep them open and maybe only charge one thing a year to keep it as an active card which will build credit. I got my first card at 16 so I have 13 years of credit even though I’m only 29. That includes a few cards, two car loans over the years, student loans, a mortgage, a mortgage that bought out my other mortgage, and I"m in the process of re-financing my house so that will now be on there as well. My credit score (last time I checked) was well over 800. I don’t know what it currently is (I have taken out a car loan since the last time I got my score, so it may have temporarily gone down a little) but I know the new mortgage company just ran my credit when I qualified for my refinance so I am going to get my current score from them.</p>
<p>Thanks, Sryrstress. I learn something new on Parent Cafe every time I read it. Employment checking isn’t a concern, but insurance pricing could be and I didn’t realize FICO could effect that.</p>
<p>“So, am I missing something? Should I care about my FICO score?”</p>
<p>You never know how it affects you. Besides insurance pricing, can you guarantee you will never want to rent for the rest of your life? Most important thing to me as a landlord, is the tenant’s credit score. Unless you’re planning to die in the next year, you might end up with another mortgage or refinance sometime in your life. Unless you are independently extremely wealthy, the ability to get a loan may be important, and you want to get the lowest rate possible. You just can’t necessarily make plans for the rest of your life (which is hopefully going to be many more decades).</p>
<p>We play a bit of a game called the credit card shuffle. We fly all the time and don’t like to pay for airline tickets. We have gotten up to 75K mileage credits just to get one credit card (that’s 2 free tickets). We have gotten tons of 0% interest for a year deals, and many deals where they actually send a check to us to get their no annual fee card (have gotten a $700, $500 and $300 check just recently). You may not be interested in doing this, but for people who have a little time and like free money, you can get thousands of dollars and many free tickets yearly, playing this game.</p>
<p>My main reason for wanting a decent credit score is so we could help our kids IF the need arises. Otherwise, it just noted in passing that ours was over 800 last time we checked, with H’s somewhat higher than mine, since he doesn’t apply for as many cards as I do. Hadn’t realized it might affect our premiums as well, but good to know. Do know that one of my employers (state govt) wanted each of us to submit our credit reports annually, which surprised me but I did so. (One woman who declined did not have her contract renewed.)</p>
<p>S likes to get free credit cards with attractive offers, like the ones you’ve mentioned. I just got a credit card & charged the required $3K so I will get points worth $500. My favorite credit card gives me 2% back on ALL charges, but I also like my AmEx that gives me 4% on gas charges. I like the United card that gives us 1 free bag–H loves checking a bag & I like traveling with a happy H; United’s card is also primary for rental claims, which can be handy, so it’s the go to card for United tickets & rentals. The other cards I don’t use so much. I find it confusing trying to use all of them often so mostly use those 3, plus one for my non-profit (also giving me back 2% on all purchases with a $100 approval bonus and $50 bonus for having an extra authorized user).</p>
<p>We once met a couple that had each gotten 100K points on British Airways for signing up for & getting approved for credit cards. They were traveling with their free points & having a great time.</p>
<p>It can get confusing. We have a long list to go through every month when we pay, to make sure we don’t forget something. It is a hassle, but I really like free tickets and getting money back. Now that we’re buying condo’s to rent, I like using the 0% ones to get big advances, instead of paying 4.75% on a HELOC to buy them. Once, Bank of America gave us 100K for one year, 0% interest, 0 fees. Insane! No wonder they are doing poorly. We took the entire amount, invested it, and well, bought some furniture, but paid it off before the rate changed. I am leery of the BA deal, I think you can still get 100K points with Chase, on British Air. But I had heard that you pay so much in fees and charges with BA, it’s almost as bad as just paying for a ticket. I don’t know if that is true.</p>
<p>We did use a 0% for 6 month credit card once – put only about 12500 on it & paid the minimum each month before paying it off in full before it was due. Might be in the market for a 0% credit card, if I can find one, but do like getting 2% back for charges. Will have to decide which works better for us. $100K for a year is impressive, especially with no interest or fees.</p>
<p>Wow, found one that has 0% for 18 months! That’s pretty impressive and no annual fee! May think about it.</p>
<p>That is a great deal. You don’t see many as long as 18 months out there!</p>
<p>One thing we’ve had a hard time finding is ones where you can get a big chunk of money, as in a balance transfer, with zero fees. They’ll give you 0% interest on purchases, or 0% for a long time balance transfer(but they charge you 3% up front). The only one we’ve found lately with 0 balance transfer fees, is Chase Slate. No annual fee, and 0% for 15 months (also on purchases). The only thing is, you have to actually balance transfer it to another credit card account (we like to do it to our checking account). They will give you 25K max on it, but let you balance transfer 23.5K on it total. I wish these other cards didn’t charge so much to balance transfer. I hate paying fees or interest, so I honestly don’t know why they keep sending us cards, they don’t make much money from us.</p>
<p>We don’t have any balances to transfer. We may consider the card, but have to figure out how we’ll pay it off when the balance becomes due. Just checked & the card we got in Dec/Jan will send us a check for over $780 whenever we ask them to, plus we got over $300 back from Costco & saved hundreds on luggage fees already on United.</p>
<p>No, the most we ever got for a credit card is the equivalent of $500 (it’s 50,000 points for charging $3K in 90 days). The $780 includes $100 acceptance bonus, $50 bonus for adding an authorized user & 2% of charges from Dec through now. We charge pretty much everything that allows charges and it adds up. Our kids U takes charge cards for tuition–wish they’d just drop the prices but that isn’t happening. Oh well!</p>
<p>Hope my niece & her folks can figure out what to do about her credit.</p>
<p>Note that there may be different scoring models for different uses, such as mortgage, auto loan, insurance rating, etc… For example, some insurance rating scoring models count store credit lines/cards negatively relative to others.</p>
There are lots of sites that advise people to have a balance or take out a loan to improve their credit scores–that isn’t necessary and could actually have a negative impact (tho of course being good for the lenders).</p>