Posted by BrendaTx on 6/5/07 6:00am
Msg #193645

Interesting story about credit

http://www.foxnews.com/story/0,2933,277874,00.html

Reply by Lee/AR on 6/5/07 7:25am
Msg #193648

The fix:

FICO will no longer be including any account where there is an 'authorized user' who is not responsible for payment. This will hurt spouses & kids, but stop the 'coattailing'. Read it all here:

http://www.foxnews.com/wires/2007Jun05/0,4670,FairIsaacFICOScore,00.html

Dang... and I was just going to rent out my credit score... pays better than NSAing these days.

Reply by JanetK_CA on 6/6/07 1:18am
Msg #193810

Re: The fix:

I heard an interview on the radio abou this this morning (might have been the same guy) and I was thinking the same thing... Sounded like some easy money for a moment there. One more thing too good to be true, although I have to admit that it feels like it's defrauding the lender, even if it's currently technically legal. Ah well..........

Reply by Sharon Taylor on 6/5/07 9:03am
Msg #193655

The FICO score method stinks anyway

If you have credit cards, and you cancel any of them, you could actually hurt your FICO score. If any of you listen to Dave Ramsey, you know what he thinks of the FICO score. Basically if you have unused credit cards and you cancel them, you are lowering the amount of credit available to you. FICO bases one of its ratings on the ratio of how much credit you have available to you as opposed to how much you owe. So if you have $100,000 available on 10 credit cards, for example, and you owe $10,000 total on the cards, your score is much better than if you cancel 8 of those cards and then have $40,000 available on 2 credit cards and owe $10,000 total on them.

Reply by PJM/MI on 6/5/07 9:52am
Msg #193672

Re: The FICO score method stinks anyway

It sure does! A friend of mine (nickname "The Bank" has paid cash for everything he has every purchased. He has never had a credit card in his life. When he went to purchase land (and wanted to pay cash), the realtor had an absolute fit that he doesn't have ANY credit history at all.

Reply by Dorothy_MI on 6/5/07 12:21pm
Msg #193695

Re: The FICO score method stinks anyway

My first year in the business I did a refi for a young couple that wanted to buy some vacant property and build several spec homes on it (the man was a carpenter-contractor), but because they paid cash for EVERYTHING and their current home they were purchasing on a land contract, they had NO credit score. The interest rate they had to pay to refinance their home to get money to make money bordered on usary. Their loan officer told them to immediately apply for a couple of credit cards and start using them so that when their arm adjusted in 3 years, they'd have a credit history. Pretty sad, when you can make payments on a land contract, pay cash for a new truck and a realitively new car, own your own business, don't owe anyone anything (except for the land contract) and be considered a bad credit risk!