Buying a home.
Renting a home.
Buying a car.
Renting a car.
Leasing a car.
Getting a job.
Getting electricity.
Getting water.
Getting cable.
Getting telephone.
Getting a checking account.
Getting a savings account.

The above list is just a sample of the things which require credit checks before "approval".

In just over a decade, the American public has been virtually enslaved by credit. This day in age, you can't so much as get the power turned on in your home without a credit check. That is, if your credit score is good enough for you to have a home.

Of course, you can always pay cash right? Well, actually no, you can't. In some cases, businesses are actually turning away from cash sales in favor of credit sales. Why? Because they stand to make a LOT more money off of you if you sign your name to a compounding interest contract. Then, not only do you pay them monthly, but if you run into a bit of hardship for a couple of months, they will take what they are "loaning" you right back and suck someone else into your old "contract". Even if this weren't the case, how many of you have an extra 100,000 in cash laying around the house to pay for a home?

But hey, the credit system is all good as long as you keep your credit score above a 725 (or what's considered the "good" range) right? Sure, I suppose it's okay then. However, keeping your credit score in that range is a lot easier said than done. Let me tell you a story.

I started building my credit from the day I turned 18. It certainly wasn't hard since I started receiving my credit card solicitations about 6 months beforehand. I tried to be smart with my credit. I would use my cards to buy only enough that I could pay off each month. And I did this for 4 years, never missing a payment. Needless to say, my credit score was PERFECT.

I was in pretty good shape. A 22 year old kid with PERFECT credit and almost ZERO debt. Then, it happened. The job I was working at was put out of business by the evil empire (ie: Wal-mart). This just so happened right after I placed a 600.00 charge on my card. But hey, it's no big deal right? Just get another job and get your payments sent in. And that's exactly what I set out to do. Unfortunately, it seemed that Wal-mart was responsible for putting a few other businesses under as well and sending too many people out into the already oversaturated job market.

Skip ahead 3 months.

I have looked and looked and looked and NOTHING. It took every bit of money I could scrape together and borrow from friends/family to be able to pay my rent and keep a bit of food on the table, not to mention the other bills. So, needless to say, my credit card payments fell behind. It was then that I noticed something amazing.

I went to the bank to apply for a small personal loan to keep me going until I could find another job. I went into the bank thinking I was a solid approval. After all, I had spent the past 4 years getting my credit score to perfect.

Imagine my surprise when my application came back denied. I was in shock. I asked why I was turned down and was told that my credit score was too low. I didn't see how that could POSSIBLY be right. However, the officer showed me the report that came back and my score was now a 610 (minimum required for the loan without a cosigner as 675).

I couldn't freaking believe it. I had busted my arse for the last 4 years building up my credit score and in 3 months time I lost almost every stitch of effort I had put into building my credit. And for what? ONE LOUSY FREAKING CREDIT CARD AND A BAD LUCK STREAK.

In 3 months time, I went from being a 22 year old kid that could get a 250k house on his own to a 22 year old kid that couldn't even get his power turned on without a deposit.

And guess what? It has only gotten worse since then. I spent the next 6 months of my life trying to get my score back up. I got a job and paid off my debt with my first 3 paychecks. Then, I went back to my old strategy of buying small and paying off each month and my credit score seemed to stay in the 600 range hell. No matter what I did, I couldn't seem to get the score back up. And guess what? I STILL haven't gotten the score back up. As a matter of fact, as a result of the interest rates on my card SKYROCKETING as a result of that 3 months, my credit score has actually DROPPED because my having to make payments a bit late from time to time.


Naturally, during this time I contemplated just dropping the card and going to cash only. However, this doesn't seem to be an option since I am not rich and can't afford to pay EVERYTHING in cash. So, here I remain, trapped in credit hell/limbo. And for what? 3 short months of hardship after 4 years of consistency.


So, what does my credit score say about me? All it says about me is that I have paid what I owe on time for all but a short 3 months several years ago.

Yet, because of that 3 months oh so long ago, I can no longer get ANYTHING that requires credit without either a cosigner or a HUGE down payment.

You want to know the really sad part?


My credit score is better than 72% of the country. That's right, I'm in the upper echelons of the credit world (based on a system of low/medium/high). Yet, for all intents and purposes, my credit SUCKS!

Guess what else? Those 3 months are also responsible for CONSTANT financial hardship since that time. So, in effect, that short time allowed the credit demons to put a hurtin on me that I still haven't recovered from. My bills are higher (in most cases), I have deposits that I can't afford, If I DO get approved for a necessity that payments must be made on, my interest rates almost DOUBLE the cost of the item(s) and I have bank fees that I would not have if my credit score was higher. I think it would be a loose estimate to say that my monthly expenses are 70% higher now that they would have been had it not been for that 3 months.

I have been very effectively enslaved by the credit mafia. I played by the rules and they still burnt me the first chance they got and they have been sticking it to me since then. And I think it's pretty safe to say that they are doing the same to you.


Does anyone else remember that time (not so long ago) when your name and reputation factored into your ability to rent/own a home and car? Now, it doesn't matter how well known you are. The owner of the Chrysler dealership could have raised you himself, yet, you aren't getting that car unless that beacon score is high enough to satisfy the loan officers.

3 little numbers have taken almost complete control of our lifes, most especially the necessities of life.

We all need a home and, if you work, a mode of transportation. Yet, you aren't getting either of these unless you have an 800 beacon score of a hell of a down payment. Not to mention all the little things (power, phone, cable) that go hand in hand with owning/renting a home.



I feel it's pretty safe to say that the conspiracy of credit has been carried out VERY successfully.


There is no avoiding it. Unless you want to live on the streets and risk jail time, harassment and/or death.


Hell, you aren't even free to be self contained. As another member so greatly put it the other day, even if you were to buy your own land, build your house with your bare hands and provide your own electricity, food and water, you STILL cannot live without credit and/or money. Why? Because you have to pay the taxes on that property or else the government swoops down and takes your land from you. And, this day in age, money (in any shape or form) goes hand in hand with credit.


So how exactly do we live in a "free" country again? I suppose we are free to live our lives as we choose, provided we are either rich of have a credit score of 800 or more. If you don't fall into either of those categories, then there is a 99% chance you too are a slave to credit.


And it's a hole so damn deep most of us will NEVER get out.


Jasn

As an added note:


Those of you guys who read this and think that your perfect credit is going nowhere because you are responsible with your money.

Remember, unexpected hardships can befall ANYONE. When they do, your credit can go faster than you may think.


Case in point,

My friend has had a perfect credit score for the last decade and is the single most responsible person I know when it comes to his money. Yet, his debt has snuck up on him really quickly in the last couple of months because the hard times just happened to land on him and now he's about a foot away from the hole being too deep to see the light at the end.


Credit is a crazy thing. And it's also a think DESIGNED to be hard to maintain. Just remember, the worse your beacon score, the harder they can rail you when you HAVE TO sign your name to some form of loan.

As soon as you start to think it can't happen to you, that's about the time you better start covering your arse.


Not all people end up with bad credit because of poor money management and planning. I planned to the best of my ability and still the hammed was dropped on me hard and fast.



Jasn


EDIT: Correction.

[edit on 21-10-2007 by SimiusDei]

Worst mistake you made was to actually pay the loan. The worst thing you can do to a past due loan is paying it, many time is better to wait for a charge off. Why? Because once you pay your credit will actually go down since you are reaging it. Next time negotiate directly with the creditor, say you will pay if they mark the debt as pay as agreed, nothing less nothing more (in writing).
There are a few estoppel letter around that might help you, go to a credit forum or buy some ebook. You can still take your good credit back, the mark will need to disappear. There are plenty of infos on how to do it on the net.

I don't live in the USA, I don't quite understand how that works. Here, your credit doesn't have that much influence. But, you aren't forced to use a credit card to buy things, now are you? Why can't you simply wait until your work check enters you bank account, than you take some money out and buy what you have to buy? Using a credit card means that you get the item first, and pay after. Why don't you wait to have to have the money first, then buy the item after?




[edit on 21-10-2007 by Atlantix]

Atlantix,

I'm not US-born and didn't understand it at first, either. Turns out having no credit history is worse than having bad credit. When I moved to the US, for years I was unable to get a credit card because they didn't have any credit history on me.

No credit history = no credit score. No credit score = you practically don't exist.

That means if you pay all your bills in cash or with your debit card, and you have zero credit card or other debt, you won't be able to...

... rent a car
... get a mortgage
... etc. etc.

That means if you EVER want to buy a house, a car, or even just rent a car, you HAVE to have a credit card and use it, to accumulate some kind of credit history. It's insane, but that's how it is.

To quote our 28th president

I am a most unhappy man, i have unwittinly ruined my country, a great indrutrualized naiton is now controled by a system of CREDIT. We are no longer a goverment by free opinion, no longer a goverment of conviction and the vote of the majority, but a goverment by the opinion and duress of a group of domintent men.

- Woodrow Wilson 1919


I don't know how to say it better then that...and don't know what we can do about it...

Simius, i too, am in a very similar situation. I am 26 and upon till very recentley had what you make call an "excellent" credit score. Fast forward about a year, a baby, new car (failed MOT), road tax, insurance for that car, insurance for contents on rented property, council tax etc etc and i am now classed as "high risk".

I have had my credit score checked through our credit agencies in the uk, Equifax/Experian and tis true, my credit score is now abissmal. I do have a few things on there I have not even applied for, will the agencies remove these - NO! Why? because the companies that I allegedley applied for the credit for have my signature on a form. Hell, they don't even have the correct maiden surname of my mother or my middle name which i always use. These seem to be fraudulent(sp?) applications, albeit declined at application. No matter how ahrd i try these will nto come off my report, for life most probably! It's a god damn farce!!!! This does happen in the UK quite a bit, just check some of the "moneysavingexpert" threads.

I don't know how the credit situation works in the US but a in the UK the "agencies" are run by banks. If you apply for credit and get refused, forget it for the next 6 months, by then you are most probably in debt elsewhere, which again means another "black mark" and so on and so on!

So Simius, i to am a slave to the banks basically! Whilst they reap in billions of £'s of profit!

In the UK recentley there has been a hell of a lot of consumer backlash, aimed at the banks. Firstly many people started to claim back bank charges, if we miss a Direct payment we did use to get charges of around £28, then they would charge you an admin charge of £28 for a letter or alike. The government have now put a stop on this recliams till a trial case is produced, yet the banks continue to charge, albeit lower, the FSA set a max or guidline of £12, hell of a lot of money for a computer to just send out a standard letter and reject a payment request.

I don't think it will be long in the UK before the public decide to stand together. We can no longer take the ever increasing taxes, house prices, fuel price (just hit a £1 a litre). Council tax will soon be re-examined for banding and it's inevitable that this will increase! If we just all stood up together and refused to work or pay taxes we'd get things changing fast. They threaten to send us to jail - which jail> they are all over stretched anyway. If we refussed to by fuel, everyone together they'd have to reduce it somehow. The tax on fuel alone is ridiculous. Mortgages are now available at 6 times annual income. that would mean somewhere in the region of £125k for me and my partner. The avergae 2 bedroom house in a a good area with good schools is £130k. The deposit, where the hell does that come from?

I know all this post doesn't apply to credit, but it's a good indication of how rip off britain has us all a slave to the banks and inevitabley the credit we all have to live off, if we already have it or can still get it!

I don't mean to sound like the A-Hole here, but what is the minimum payment on a $600.00 credit card bill?

$12?

You have no excuse for not being able to come up with $12 a month to keep your credit good.

Originally posted by Enrikez
I don't mean to sound like the A-Hole here, but what is the minimum payment on a $600.00 credit card bill?

$12?

You have no excuse for not being able to come up with $12 a month to keep your credit good.

In the UK that would be right, but minimum payments never end up paying it off! Interest alone obliterates that payment!

I dont think the OP said he had a $600 balance. I believe he said he had just made a $600 purchase. He never said what his balance on his credit cards were.





I could be wrong, so someone please clarify if I am. But did they recently change the credit score scale? All of a sudden Im seeing "900" on the scale when I thought I used to use to see it top off at 850 or so.

The whole credit score thing is a big fat joke. LOL But not a funny joke. Just the fact that if ANYONE inquires about your credit report, it is a big mark AGAINST you. Ridiculous!!!!

And if you are getting tons of credit card offers....make sure you call those banks and tell them to STOP!!! My husband just pulled his 3 reports and 2 banks have been making credit inqurires EVERY MONTH for the past year - and sending him offers!!! WTF? It is affecting his score - and he has PERFECT credit

[edit on 21-10-2007 by greeneyedleo]

We HAVE TO HAVE credit in America.. the average cost of anything we buy from clothes to TV's to hell, food, is so damn expensive it far out paces our actual wages. Hence why America's average account is actually negative, and the only time that has happened was during the great depression.

Houses should not be 500k, they should never be so expensive that only 5% of the country actually makes enough to buy a house outright within a few years of savings.

Buying a home.
> Depends.

Renting a home.
> Possible. I rent and I didn't have a credit check.

Buying a car.
> Not if you pay cash. Which you should.

Renting a car.
> Not the last time I rented a car.

Leasing a car.
> That's just stupid.

Getting a job.
> Lame job.

Getting electricity.
> Not here.

Getting water.
> They definitely don't care.

Getting cable.
> Can't comment... don't have cable.

Getting telephone.
> Nope.

Getting a checking account.
> Depends on the bank. Mine doesn't.

Getting a savings account.
> Same.

I don't know what my credit score is. I don't use credit, and I'm not "rich." If instead of worrying about credit cards you just piled up money in the bank, you wouldn't have to freak out when Walmart comes your way.

This is just a stunning example of why this country is rotting from within.

REJECT THE BRAINWASHING! YOU DO NOT NEED CREDIT!

What people don't understand or maybe they do is that everything is a personal choice when you use credit or get a loan.

Let see!


What to I need in Life? Vs. What I want now?

If you can get by with the things you only need and not buy into the BS of using credit to buy everything you want, then life and your financial situation will be much better.

Never live beyond your means and if you do the only person responsible for it is the one that looks at you every day in the mirror.

You don't need to charge a significant amount of money on your cards to start building a credit history. My parents sponsored me for my first credit card when I was 16 both to help start building my credit history and for gas/emergencies. Even if you only charge $5 bucks to several different cards each month and pay them off, you'll be on your way to a good credit history. Nobody says because you've got a few cards with $10k/limits a piece that you have to max them all out.

I only use my debit card for purchases and bills (that is, spending money I have), and use a gas credit card for my fuel (which I pay in full, but use because I get both discounts and keep a steady payment history for my credit rating.) It's common knowledge and sense that you ought to keep at least six months worth of funds to cover all your expenses should tragedy strike. The problem, like noted, is that folks live outside their means. Those folks can only blame themselves, sorry.