Building credit is an m f'er

[Kaneman]

I hate this credit scam stuff man. Been trying for 2 years to get my wife some credit, and despite making good money its just nearly impossible. When we first got together she was moving from her old apartment. She's got one $300 blemish from getting screwed on her old apartments, so initially I figured no big deal.

I've since secured two credit cards for her, which she uses regularly and pays off every month. Never been late, doesn't carry a high balance...and I still can't get her out of the low 600's. WTF? What else do you have to do?

We're suddenly in need of a new vehicle, no problem, plenty of money to put down, make the payments, and all that. But of course we can't get a car loan. So we can go to a tote the note dealer, put a big down payment down, get raped on the price and financing....but it doesn't report to her credit so we're in the same boat. On top of that the cars they sell are beat to shit.

I'm to the point where I'm going to offer a family member something like $5k cash to co-sign a loan for her....which is what I had to initially do to establish mine way back when too. Which brings up another good point, don't ever get your identity stolen.

[Dave]

Buying a house took me from zero to around 700 in about a year

[Kaneman]

Buying a house took me from zero to around 700 in about a year

So how do you buy a house with no credit?

[CrazyKell]

House is "easier" to get because it's a secured loan whereas the car is not.

I'm in the same situation now. Was out of the country for 2 years and it basically effed my credit royally. :(

[shmike]

House is "easier" to get because it's a secured loan whereas the car is not.

I'm in the same situation now. Was out of the country for 2 years and it basically effed my credit royally. :(

A car loan is secured by the car, making it a secured loan.

An unsecured loan is where the bank has nothing to "take back" if you default.

Think credit cards, student loans, signature loans, etc.

Kaneman,

My best advice is to work your way up.

If you have an extra $5k, instead of paying a family member to co-sign, deposit it in a bank and then take a secured loan against it.

After establishing a history of installment payments her score should jump more than it would with a bunch of revolving accounts.

[Kaneman]

A car loan is secured by the car, making it a secured loan.

An unsecured loan is where the bank has nothing to "take back" if you default.

Think credit cards, student loans, signature loans, etc.

Kaneman,

My best advice is to work your way up.

If you have an extra $5k, instead of paying a family member to co-sign, deposit it in a bank and then take a secured loan against it.

After establishing a history of installment payments her score should jump more than it would with a bunch of revolving accounts.

Need a car now though bro. I'm taking care of my step-son and need something much more reliable than I have now. Mine broke down the other day in 105 degree weather, and he's in the back wearing a body brace...so yea, an actual, reliable automobile is the main priority.

I don't care about having to pay more, but like I said with the tote the note places...their vehicles are shit. Two of the Tahoes I looked at yesterday didn't even have radios...just wires. :lol:

[shmike]

Need a car now though bro. I'm taking care of my step-son and need something much more reliable than I have now. Mine broke down the other day in 105 degree weather, and he's in the back wearing a body brace...so yea, an actual, reliable automobile is the main priority.

I don't care about having to pay more, but like I said with the tote the note places...their vehicles are shit. Two of the Tahoes I looked at yesterday didn't even have radios...just wires. :lol:

I hear ya.

$5k is a lot of money. Maybe you can deposit that into an escrow account and give the co-signer a $500 thank you and any interest the account accrues. :idk:

Hell, for $5k I might even co-sign for you. :lol:

[derf]

install radios then!

Seriously, dont pay your credit cards off, leave a small balance on the cards, like $50-100 then pay off every month after that leaving the original $50-100 on it. Also what is your debt risk? if you have 10k worth of zero balance credit cards that is bad, because then you are a risk of charging 10k worth of debt overnight

[shmike]

How many kids to do you have in total (yours, mine and ours)?

It won't help build credit but you should be able to buy a decent reliable car for cash with $5k.

Toyota Corolla, Camry, Honda Civic, Accord, Ford Exploder, etc

[Kaneman]

install radios then!

Seriously, dont pay your credit cards off, leave a small balance on the cards, like $50-100 then pay off every month after that leaving the original $50-100 on it. Also what is your debt risk? if you have 10k worth of zero balance credit cards that is bad, because then you are a risk of charging 10k worth of debt overnight

Not at all man, I think her total limit is like $1,500, nothing big at all. We've tried leaving small balances on there as well. The only thing we haven't done is pay the minimum payment, or be late.

I think its because she's Mexican.

How many kids to do you have in total (yours, mine and ours)?

It won't help build credit but you should be able to buy a decent reliable car for cash with $5k.

Toyota Corolla, Camry, Honda Civic, Accord, Ford Exploder, etc

2 Kids and three big ass dogs won't fit in a Corolla. :lol: And I'm reluctant to put money toward anything refereed to as the "Exploder." No man, if I'm putting $5k into something I'm getting what I want.

[smileyman]

What Smike said.

Go to the bank you check or save at, talk to a loan officer, tell him you want to open a big CD then borrow using it and a vehicle as collateral. Nail down terms.

If you have a relationship with that bank already the loan officer can get policy approval or waivers to do a 20 pct down auto purchase loan. I love those kinds of deals.

[shmike]

2 Kids and three big ass dogs won't fit in a Corolla. :lol: And I'm reluctant to put money toward anything refereed to as the "Exploder." No man, if I'm putting $5k into something I'm getting what I want.

Josh, stop and think about what you NEED.

You NEED reliable transportation. You don't NEED someone's tossed aside family truckster.

If you NEED to be there for the kids (especially with the step-son right now) the dogs can stay at home.

If you NEED to haul the dogs, get a pick-up truck with a bench seat.

You can have whatever you WANT in a few years when you have a 750 Fico and can get a 0% loan.

[Kaneman]

Nah, you know how I roll, dogs are a big priority. A car is a long-term commitment, so I'm going to get what I need now instead of getting into something that doesn't suit my needs. Unless of course it becomes impossible, then I'd probably settle.

We do have one reliable car, but man is that thing tiny. (Toyota Celica)

[smileyman]

Shame your not closer, i would make you a great deal on an 04 T Blazer ext LT. 7 row and leather with 90K. You wouldn't have to borrow but 2K

[Rangerscott]

But a car is a depreciation unlike a house.

[Kaneman]

I know there's that whole anti-big SUV crowd, I get all that. But for the active lifestyle that my family lives, bicycling, dogs, camping, fishing, etc., we really do need a big vehicle. Not to mention all the lumber and supplies I have to haul to the house while we're upgrading it.

Now, to be honest a mini-van would probably fit the bill too and get a little better gas mileage...but I don't care, because I don't want one. :lol: But a Corolla, a Camry or anything like that would be a complete waste of money.

[CrazyKell]

A car loan is secured by the car, making it a secured loan.

But a car is a depreciation unlike a house.

This is more what I meant. The bank has something of value to take back with a house. With a car...not as much.

[shmike]

I know there's that whole anti-big SUV crowd, I get all that. But for the active lifestyle that my family lives, bicycling, dogs, camping, fishing, etc., we really do need a big vehicle. Not to mention all the lumber and supplies I have to haul to the house while we're upgrading it.

Now, to be honest a mini-van would probably fit the bill too and get a little better gas mileage...but I don't care, because I don't want one. :lol: But a Corolla, a Camry or anything like that would be a complete waste of money.

I'm not anti anything.

I like my vehicles big. The BIGGER the better. My small car recommendation was for cheap reliable cars that should last forever.

I know the Explorer has a bad rep but I would seriously consider one. My wife had one when we were dating. 180k on the clock and it still drove strong, all power options still worked and the air blew cold.

You should be able to pick up an early 2000's model for pennies.

[Cutty72]

Have the same issue with my gf. Shit credit when we got together, been working on getting it up, she's into the 600's now. Bank won't even give her a 3K loan securing it against her car that she owns, saying she doesn't have "established credit". She's got 3-4 cc's, cell bill, student loans, etc. Not sure what else she can do?

I feel your pain man.

[pauldun170]

I usually recomend folks stay away from used Explorers.
For 5G you have unches o bunches o options.

[smileyman]

Basically the bureau's metrics and formulas for coming up with a credit score lacks a ton of common sense. They are complicated. So complicated they overlook the obvious.

I had excellent credit after my divorce, but alot of good regularly paid debts overlooks a source of cash flow or revolving debt dependency. I was broke. Then pile on some non bureau reportables like taxes and medical bills and I am bankrupt but with a 700 plus score...Its nonsense

[Kaneman]

Basically the bureau's metrics and formulas for coming up with a credit score lacks a ton of common sense. They are complicated. So complicated they overlook the obvious.

I had excellent credit after my divorce, but alot of good regularly paid debts overlooks a source of cash flow or revolving debt dependency. I was broke. Then pile on some non bureau reportables like taxes and medical bills and I am bankrupt but with a 700 plus score...Its nonsense

Oh yea, common sense doesn't even factor in on the equation. I've done some credit analysis and have training from Experian. I'm no expert, but I understand how it all works. Its all absurd.

[Tsunami]

Kaneman, my Fico score is about 735 and I can't get a loan. I think its just not that easy to get loans anymore. I can barely get a credit card, the last one I got was for $1k. And f'n BOA cut my credit line from $30k to $9k saying my debt to income ratio was too high.

[smileyman]

I was approved for a 0 down home mtg 100K+ last May, pay on time and have been denied for a Toys R Us, Lowes, and Home Depot credit acct.

!?!?

[TommyHotWheel]

http://www.drivetime.com/ I had to go here. You get raped, but the trucks are in good shape and they work with you, try to get the intrest as low as possible.

[Kaneman]

http://www.drivetime.com/ I had to go here. You get raped, but the trucks are in good shape and they work with you, try to get the intrest as low as possible.

There's a Drivetime right down the road from me. I've been tempted to go there....but I've done so many fraud investigations in which their name came up I'm very weary.

I don't want them to sell me a vehicle they don't own.

[TommyHotWheel]

There's a Drivetime right down the road from me. I've been tempted to go there....but I've done so many fraud investigations in which their name came up I'm very weary.

I don't want them to sell me a vehicle they don't own.

The fraud I had heard about was individuals losing cash payments and taking cars back as a result. I paid with a check and kept all of my reciepts, just like everything else, cover your ass. They give warranties and vehicle history reports now too, so maybe give them a look and if ya buy something, gimme a shout, my wife needs to build her credit and I think this is a route we will be taking, $200 for referrals.

[Kaneman]

The fraud I had heard about was individuals losing cash payments and taking cars back as a result. I paid with a check and kept all of my reciepts, just like everything else, cover your ass. They give warranties and vehicle history reports now too, so maybe give them a look and if ya buy something, gimme a shout, my wife needs to build her credit and I think this is a route we will be taking, $200 for referrals.

I might go up there on your recommendation then. So they report to your credit right?

[TommyHotWheel]

Every payment. Work on the intrest, its gonna start high, but pound them.

[Kaneman]

Every payment. Work on the intrest, its gonna start high, but pound them.

Oh absolutely. I fully plan on doubling the payments on whatever I do.

[cbrchick]

So she has cell phone bills, utilities, and stuff as well that she pays on schedule right?

Does she have a decent income and a low debt? You don't need a lot of credit cards as well to get good credit. I have one and it's secured. Does she have any savings that she can use to secure a credit card?

Does she have a savings account that she contributes to? Investments? A little contribution goes a long way.... At least, it does here. Banks want good security for their money. ..

[Kaneman]

Yea we do have all that...but they only look at the report from one of the 3 bureaus, and things like cell phones, utilities, etc. don't report to those.

We got approved today at DriveTime for the car we want. Its $4k down, $400 a month. The total cost of the vehicle is about $4,000 over what its worth, and of course the interest is high. It does come with a warranty, and its in good shape, and low miles compared to what we were looking at.

We went to some other places too, trying to check on first time buyers programs. There's just nothing out there other than buy here pay here places.

We just have to decide if we want to bite the bullet and basically pay to start building her credit.

Tommy, PM me your full name so I can get you the reference credit.

[Kaneman]

Holy shit. DriveTime has the worst web reviews I've ever read. Granted, some of them are people whining because they couldn't make their payments, but most of it seems to be people who bought lemons and DT wouldn't honor the warranty, shady stuff with the payments, stuff like that.

I might have to pass on those guys.

[Rangerscott]

I had no credit history and got my dad to help co-sign a $2k loan. I paid it off way to fast so it didn't help my credit score. Found the VFR and had him co-sign a $4k loan. I think half way through that loan I got one of those $500 tire loans and used that. By just paying the monthly payments on both of those, my credit went from 3xx to high 600's. I found that out when I went in the first time to see if I could get approved for a mortgage. I was good to go for a mortgage, but I sat for 6 months. I went to another bank and they did a lot better on the mortgage and my credit was almost 750. The guy told me with that I'm approved for any amount. Of course I have a set price on what I can do for my first home.

I now owe $4k on a loan I took out for my ER-6N. I just pay monthly and I can still get a mortgage any time I find a house to buy. Also I have NO credit cards. Basically I doubled my credit score by one little $4k loan. Sure I pay a little more with loans, but it sure feels nice to walk into a place and they say pick out what ever you want.


It really is mind bottling that some people just can't build credit. It really does suck that one screw up and you get a frowny face stamped for a long time.

[defector]

Holy shit. DriveTime has the worst web reviews I've ever read. Granted, some of them are people whining because they couldn't make their payments, but most of it seems to be people who bought lemons and DT wouldn't honor the warranty, shady stuff with the payments, stuff like that.

I might have to pass on those guys.

FWIW, I never had a problem with them. Vehicle wise or otherwise. I could have went to any other lot, but I am lazy, and they were right around the corner.

[Kaneman]

I had no credit history and got my dad to help co-sign a $2k loan. I paid it off way to fast so it didn't help my credit score. Found the VFR and had him co-sign a $4k loan. I think half way through that loan I got one of those $500 tire loans and used that. By just paying the monthly payments on both of those, my credit went from 3xx to high 600's. I found that out when I went in the first time to see if I could get approved for a mortgage. I was good to go for a mortgage, but I sat for 6 months. I went to another bank and they did a lot better on the mortgage and my credit was almost 750. The guy told me with that I'm approved for any amount. Of course I have a set price on what I can do for my first home.

I now owe $4k on a loan I took out for my ER-6N. I just pay monthly and I can still get a mortgage any time I find a house to buy. Also I have NO credit cards. Basically I doubled my credit score by one little $4k loan. Sure I pay a little more with loans, but it sure feels nice to walk into a place and they say pick out what ever you want.


It really is mind bottling that some people just can't build credit. It really does suck that one screw up and you get a frowny face stamped for a long time.

Its not mind boggling dude, some people just don't have anyone that will co-sign for them. This would be simple if we had a co-signer.

FWIW, I never had a problem with them. Vehicle wise or otherwise. I could have went to any other lot, but I am lazy, and they were right around the corner.

Man I want it to work out, but the fraud investigator in me is screaming red alert right now...

[VatorMan]

www.prosper.com


I am a lender there. It works out OK-not great as there is a 25% loss rate-but give it a try.

[TommyHotWheel]

Go with your gut Josh, I took the truck I bought to a shop and had it checked and then had a title search done on it, I seem to be another of the guys that had no problem, cuz I didnt let a problem happen. If you are not sure of it, dont, unless you are in a bad situation like I was. You have to trust your gut, or do a lot of homework.