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Frequent Contributor
Posts: 443
Registered: ‎06-07-2007

Credit Card Reponsibility

I dont think anyone likes to talk about this topic but I feel its the most important one of them all. I know this entire forum is dedicated to reactive advice about fixing Fico Scores. How about being proactive and being an advocate for responsible credit card usage. I truly belive that ABSTINANCE will get you a way better score than after the fact problem solving. What do you guys think?
Frequent Contributor
Posts: 277
Registered: ‎10-21-2008

Re: Credit Card Reponsibility

[ Edited ]

I believe FICO is geared towards using credit responsibly (because it's supposed to be an indicator of the risk an individual will default), so abstaining completely will not give you as good a score as using it a little and PIF'ing each month.  If you don't use your cards, FICO has a harder time determining that.  Also, I think FICO wants to see how you deal with a variety of credit, so to max out the score you probably need mortgage and installment (car) loans in your credit history (not sure they have to be open accounts tho).

 

What's best for you might not make the highest FICO score.

 

 

Message Edited by writemikep on 11-03-2008 01:17 PM
Senior Contributor
Posts: 3,279
Registered: ‎08-03-2007

Re: Credit Card Reponsibility

I find that using my Amex Platinum card really does help me from spending more than I should. With the threat looming of PIF, it keeps within what I can afford and away from temptation.
Here we go again...
Established Contributor
Posts: 683
Registered: ‎04-05-2008

Re: Credit Card Reponsibility

[ Edited ]
I agree, ddd. Far too often I see people here encouraging people already in debt with high util to apply for new credit. I also see people giving advice to others about which CCs they are SURE to get based on their credit scores specifically, which is bad advice because your score is NOT the only option creditors weigh on. I appreciated that tid bit of advice when I first got it, but I have learned the hard way!

I also see people app'ing like it's "in style" and pushing the button for others to get on the "app" frenzy bus. But, what I can't stand the most is those here who seem to think CCCs owe them something after 1-2 months of PIF history so they harass them to get CLIs. It just amazes me the number of threads on "asking" for CLIs or threatening to cancel their CCs if they don't get one. Why can't some of us just wait? Patience is a virtue, you know?! Then again, some of us NEVER learn!

I think we need more threads on credit gardening especially the way the CC world is today.

Sorry and forgive me. Had to vent! Smiley Happy
Message Edited by Uniqua on 11-07-2008 11:48 AM
Message Edited by Uniqua on 11-07-2008 11:49 AM

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Valued Contributor
Posts: 2,205
Registered: ‎12-06-2007

Re: Credit Card Reponsibility


ddd wrote:
I dont think anyone likes to talk about this topic but I feel its the most important one of them all. I know this entire forum is dedicated to reactive advice about fixing Fico Scores. How about being proactive and being an advocate for responsible credit card usage. I truly belive that ABSTINANCE will get you a way better score than after the fact problem solving. What do you guys think?

 

I have to disagree. After being removed from the workforce due to illness, I decided since I had no job, (a severe cut in income), and was also going through a divorce(an even greater reduction in income), I closed out all of my accounts. I did not have any clue on what affected my credit scores at that time. So, I went years without opening new credit, because I didn't think I could. Not using credit did not help improve my score, this is certain. Now I am 38 and having to start all over again. Thankfully with these forums, I have a better understanding of what makes up my FICO and what I can do to be sure I have the best one possible. Simply not using credit at all is not going to help FICO.

 

And who here is not advocating responsible use of credit cards? PIF, not maxing out your cards is not sound advice? That seems to be the 2 most mentioned here.

Frequent Contributor
Posts: 443
Registered: ‎06-07-2007

Re: Credit Card Reponsibility


FretlessMayhem wrote:
I find that using my Amex Platinum card really does help me from spending more than I should. With the threat looming of PIF, it keeps within what I can afford and away from temptation.

 

I agree my Charge Card makes me think 3 times before I purchase somehting.
Frequent Contributor
Posts: 443
Registered: ‎06-07-2007

Re: Credit Card Responsibilbity


writemikep wrote:

I believe FICO is geared towards using credit responsibly (because it's supposed to be an indicator of the risk an individual will default), so abstaining completely will not give you as good a score as using it a little and PIF'ing each month.  If you don't use your cards, FICO has a harder time determining that.  Also, I think FICO wants to see how you deal with a variety of credit, so to max out the score you probably need mortgage and installment (car) loans in your credit history (not sure they have to be open accounts tho).

 

What's best for you might not make the highest FICO score.

 

 

Message Edited by writemikep on 11-03-2008 01:17 PM

No that was not my point when I used ABSTINENCE. I used when it comes to Irresponsible spending or spending more than what you can afford to buy. I do not mean total Abstinence I mean abstain from buying anything that you could not pay for in cash. I just think that if we preached this more and more maybe so many people would not be in credit trouble.

 

Instead of looking for banks that aprpove a certain score we should be tlaking about what can you possibly afford to spend on your specific budget. Can I affford X instead of I have enough credit to buy this I can pay it later.

Valued Contributor
Posts: 2,205
Registered: ‎12-06-2007

Re: Credit Card Responsibilbity


ddd wrote:

writemikep wrote:

I believe FICO is geared towards using credit responsibly (because it's supposed to be an indicator of the risk an individual will default), so abstaining completely will not give you as good a score as using it a little and PIF'ing each month.  If you don't use your cards, FICO has a harder time determining that.  Also, I think FICO wants to see how you deal with a variety of credit, so to max out the score you probably need mortgage and installment (car) loans in your credit history (not sure they have to be open accounts tho).

 

What's best for you might not make the highest FICO score.

 

 

Message Edited by writemikep on 11-03-2008 01:17 PM

No that was not my point when I used ABSTINENCE. I used when it comes to Irresponsible spending or spending more than what you can afford to buy. I do not mean total Abstinence I mean abstain from buying anything that you could not pay for in cash. I just think that if we preached this more and more maybe so many people would not be in credit trouble.

 

Instead of looking for banks that aprpove a certain score we should be tlaking about what can you possibly afford to spend on your specific budget. Can I affford X instead of I have enough credit to buy this I can pay it later.


Not spending more than you can afford to pay back immediately is pretty much common sense. Having available credit doesn't equal debt, unless a person decides to spend beyond their means. I do not need a forum to tell me that I may have $$$ in available credit and only $$ in income that if I were to spend up to all of my available credit that there is going to be a serious problem. But yes, I do believe in a budget and I do spend accordingly so that there isn't a problem. 

 

Senior Contributor
Posts: 3,017
Registered: ‎06-03-2008

Re: Credit Card Responsibilbity

I agree with Stef. Since I started reading and then posting here, I have quadrupled my CL's, added new credit cards to my portfolio and raised my scores over 100 points. While I have access to MUCH more credit now, I currently have $37 reporting on my credit reports. I don't owe anybody a dime. Never buy more than I can afford and PIF every month.
Community Leader
Senior Contributor
Posts: 4,336
Registered: ‎09-06-2008

Re: Credit Card Reponsibility

i think you all are right on...

 

but i also don't see the problem in say, taking advantage of a 0% offer at best buy to buy a nicer tv or whatever then you would have cash for, & paying it off over 3 months.  as long as you are actually taking care of your debt, i don't see the big deal.

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