Maintain, build, rebuild----your credit thread

[Born2Juice4Ever]

maintain, build, rebuild----your credit thread



I wanted to start a thread where WE could all give our input advise on how to:

-Maintain a healthy credit rate
-Build your credit (in case you are young, or starting over)
-Rebuild your credit ---bankrupt, or credit problems from the past.


I am 34 years old, and I own a business--I have an extensive accounting and finance background, but I have engaged into the restaurant undustry since a couple of years, and loving it!!. I know that there are quite a few business owners on the site, or some who are currently exploring how-to engage into one...or some who are simply JUST wanting to establish credibility with the banks or lenders again.

At the age of 23 I underwent a serious bankruptcy, and one that taught me a lot in my early years. A valuable experience i carry with me.

If our economy happens to be bouncing, or steadily staying low key; our credit moves on forward.

Not being able to get credit can be a very frustrating experience, and one that really does not make YOU a bad person.
Sometimes even getting a small credit card for 1k or 5k can be a very tough and trying experience.
Unfortunately our financial world revolves around certain rules and regulations.

I hope that those who have questions, that you ask them here. Those who can offer a hand of advise, that you jump in and help out.
Those in the banking industry, who work with fico scores, work with the latest lending trend---jump in as well.


I expect this thread to be a lucrative thread for us all:)

B2J

[JonnyO]

This is a good topic bro.

[canadianmuscle0803]

i have the worst credit possible.. if anyone can help me that would be great.. i dont owe enough to really go bankrupt but i owe enough where i cant really pay it back.. double edged sword.. any suggestions as i know shit all about this stuff..

[JonnyO]

Debt sucks bro it's so ****en stressful. One thing you can consider is getting a co-signer (they will have to be added to the account) and get an overdraft attached to your bank account with a low interest rate and pay off your debt with that so your not paying interest with minimum payments...you will save $ in the long run and get out of debt faster.

I was in a bad credit situation as well when I was young and dumb and didnt care about shit like this. I am now doing a lot better, slowly but surely. But one thing you dont want is the Credit Bureau on your ass or on their bad side as they will **** you sideways and dry too, they wont even spit on it they'll just **** you.

[Born2Juice4Ever]

...I have a lengthy post...but I have to edit a few things on it...I will be back fellas. :)




B2J

[Sean Summers]

Don't go bankrupt. My buddy is on his second one (I can't f*cking believe that) and he gave me the scoop. Places that you go to for bankruptcy are a business. They make money when you file so they really don't have your best intentions at heart. Try very hard to not go in debt. If you do then work damn hard to get out of it. That means KD every night, no movies, no TV...etc. Suck it up. Get 2 or 3 jobs. McDonalds is always hiring, Tim Hortons is always hiring...you get my point. Don't believe in these get rich quick schemes - they never pan out. Time for some elbow grease.
As for rebuilding your credit pick up a Home Trust Visa. They are pre-paid Visas. You need a credit card to book a hotel room, get a car rental...etc. You NEED one. Go that route and you will build up your credit.
Also, you may need a cell phone....get a pre-paid one. You know the pay-as-you-go ones. I am trying to help my buddy out but he is really f*ucked. I guess when you don't work but you can pick and choose jobs/live off of credit you can't expect to stay debt free for very long.
SS

[theboss]

Don't go bankrupt.
SS

words to live by.

work yourself out of debt or do everything SS said to not get into it.

i have the opposite problem....too much credit (cards etc)....go for a mortgage and the bank worried i would get in to deep if i started using them....i said check my credit... IF i use them I pay them off...never missed a payment etc.....most of the cards i dont even use (think i have 8 and use 2)......cant cancel cards either.....that also damages your credit...they look at it like you have financial problems when you start saying you want to cancel them.

[ironwill]

words to live by.

work yourself out of debt or do everything SS said to not get into it.

i have the opposite problem....too much credit (cards etc)....go for a mortgage and the bank worried i would get in to deep if i started using them....i said check my credit... IF i use them I pay them off...never missed a payment etc.....most of the cards i dont even use (think i have 8 and use 2)......cant cancel cards either.....that also damages your credit...they look at it like you have financial problems when you start saying you want to cancel them.
if you cancell credit cards it makes your profile look better bro...By having a card, the bank sees you are capable of taking x amnt of money out on loan, and that would make it look bad for your debt ratio...If you have high dollar credit cards and close them, you have more availble for debt if you need to make a large purchase in accordance with your verified income, like a home, or whatever.....if you have good credit to begin with.....

[natenator]

if you cancell credit cards it makes your profile look better bro...By having a card, the bank sees you are capable of taking x amnt of money out on loan, and that would make it look bad for your debt ratio...If you have high dollar credit cards and close them, you have more availble for debt if you need to make a large purchase in accordance with your verified income, like a home, or whatever.....if you have good credit to begin with.....
this is true. I had close to $500K in available credit at one point from credit cards and lines of credit and scaled it rigth back to what I need *now* When I was looking at buying a few retail ventures the banks were concerned about the available credit I had. Yes my history was great but had I went through with the ventures and the bank loaned me the $$ AND I decided to dig into the available credit then my payments would be through the roof and the bank left wondering... how can he pay US back?

ditch what you don't need.

[Sean Summers]

Ditch them slowly. It doesn't look good if you cancel 4-5 cards all at once.
SS

[natenator]

what always bothers me about banks and credit card companies is they'll do everything to help you to get into debt but won't help you to try and get out of debt.

It takes 2 to tango and yes personal responsibility should be addressed but a person making $30K/yr has no business having a credit card with a $5K limit on it.

When I was in high school going into University (18) I had a credit card with a 2K limit on it and I worked part-time at a damn restauraunt lol How's that math add up?

[Born2Juice4Ever]

Ok,

There is a lot of info posted and a lot of info to be passed on, but for now I am going to try to explain how the banks gauge WHO you are or WHAT you are to them.

The banks and lending institutions have a rating system called: FICO SCORE.
The FICO score is a number that determines how good or bad you are in the finance department---I will explain.

In Canada there are TWO private agencies that maintain these records on you, or anybody who has or has had credit in the past:

-Equifax
-Trans Union
Whenever you apply for a loan, or whenever you apply for anything that has to do with money..or when you make several late payments, or get into hot waters with a lender--those two places are informed of your financial behaivoir.

FICO: The system rates each individual depending on how you handle your finances.
The number starts at 300 and goes up to 900.
From 300 to around 620 you vary from VERY POOR, to POOR credit rate.
Anything from 600 to 900 is good, to VERY GOOD.

I worked at a lending institution for 2 years, I was in the audit department, and then moved onto collections for a bit.
While working in the audit department, I was coming across accounts in the half a million dollars. Revolving accounts..
Some of those accounts where held by people in the late 60s or even 70s.
How can a person who is 70 years old,hold debts of 200k?? More so, how can a person who at the time of application was 70 and applied for a loan of 100k? AND get approved?
GREAT FICO reading.
As long as you make payments during your time, (within limits of course) the bank will have no problem giving you money.
I know of at least one person who has open credit inclusive of over the 700k mark, where he makes around 70-80k annually. The open credit and what he makes per year does not equal hu? Huge debt, relatively low income. Assets, and potential to pay back play a big factor for the banks.---if there was default on debts, the banks will be able to recover some of their money.
My parents are in their 50s and mid 60s now,they both have huge debts with the banks, but the banks even though they are both aging, have a lot of respect for them (FICO) because of their great history. The banks KNOW that they will not be able to pay the huge debts in their lifetime.


I just want to logic out a comment on how the banks give give money, to essentially allow people to get into debt, but won't help people clean the debt? Nate specifically.
NOBODY forces anybody to sign a loan. The banks are there to help us build our homes, go on trips, put our children through school.....get dental..ect ect.
Slow paying costumers, low interest rates...TAKING a risk as a lender.

There is a lot of stuff I would like to cover, but and I will do so:)

By the way too much credit is not a bad thing. OPEN credit is NOT a bad thing.

I always advise that if you want to build your credit, this is one easy way of doing so:

-whenever you see places like the Brick, or Leons giving an open line of credit of (lets say) 2000.00 and NO PAYMENTS NO INTEREST for ONE full year. THESE ARE GREAT FICO SCORE BUILDERS.
You go, apply, get the open loan, max it out, and then JUST before the one year mark, pay that sucker right OFF.
The banks will see an open credit and will see PAY OFF without any problems.



B2J

[St]

Ya i had problems about 15 years ago.