01-25-2013 11:01 AM
I have been living rent/mortgage free for about a year now. While poking around the Mortgage section of this forum, I came across the term "Payment Shock" (in simple terms; going practically from having no bills at all to paying mortgage or rent and not being able to adjust your finances accordingly, thus falling behind on your obligations). Is this something that credit card companies also take into account if I were to put "None" or "0" on the mortgage/rent portion of a credit card application? Or do they look at it as a positive thing because I have all this money available to pay for my credit card bills? I currently make about 65k.
Prior to 2012 I had been renting for several years, but after my apartment burned down (arson) early 2012, I moved back to my parents house "temporarily" (my mom couldn't be happier).
I do pay many of the bills now that I live there, but I obviously wouldn't have a ledger to show anyone because I don't pay actual rent...
01-25-2013 11:34 AM
Payment shock is very mortgage specific actually. CC's don't worry about this at all to my knowledge; however, be aware they may impute some rent calculation for you when figuring out the Credit Limit they intend to offer.
I wouldn't worry about it though, it won't affect your approval changes much if at all, and it might even be a small benefit, namely more disposable income available if they don't impute the rent number.
01-25-2013 03:46 PM
When requesting a cli for my wife on a cc of hers, the issuing company would not allow her to put zero for rent or mortage even though that is accurate and truthfull. They also would not let her put a phantom amount in there either. It had to be realistic to the comparable rents where we live.
01-25-2013 04:28 PM
And then in the bottom of the application there is a long legal jargon in super small font saying that by signing above, you're attesting that all information provided is true and accurate. Otherwise we can sue you and your dog for everything you own.
I guess the FICO system isn't the only mystery we're dealing with here...
01-26-2013 12:42 PM
01-26-2013 01:51 PM
In the last six or seven years my wife and I applied for several CC's (Citi, PenFed, GE, Amex) and always put $0 for rent and mortgage (which is true) and never a question or a problem.
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