The use of credit cards in the evaluation of credit ratings has to be reversed!
Currently having a credit card is placed at the top of the list in evaluating credit and credit ratings. This punishes all of us who are working to live within our means and being fiscally responsible with our budgets. My husband and left our 1st marriages with a mountain of debt from credit cards attained by our ex-spouses. We both worked very hard to pay off that debt and close all cards. Neither of us ever want another card again. And for being fiscally responsible, we are punished.
We have a mortgage, an equity line, and a loan on 2 Harley’s. We have never missed payments, never have we been late on payments. But when we applied for financing on the bikes, we were told that our credit rating was low and we could get the financing if we agreed to a higher ‘risk’ based interest rate. Why? Because I refuse to pay some bank a fee for the privilege of using my own money from future income? I choose to wait until I have the money in the future and then buy what I need or want.
For this I have to pay higher interest rates and am punished for being responsible. While other people who have 5 or 10 credit cards, which are maxed out, and can only pay the interest on those cards, live with financial gold stars and gain the highest ratings from credit companies. Perhaps it’s time to get back to the basics, if you don’t have the money to buy something, then learn to do without. Get rid of the credit cards, and live within your means.
Where would our economy be if people did that? Can you imagine? There might actually be a housing market right now that is stable, solid and thriving. Americans might actually have a savings account that can provide income for emergencies. People who bought a house, might actually have purchased one they were qualified to pay for. Geez, rocket science.