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Old 10-15-2021, 09:12 PM   #61
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Originally Posted by Retire2023 View Post
We have not had a mortgage in over 20 years and no car payments since ~2005 (0%offer). I do have over $90K in available credit card limits over 4 cards, which of course we use frequently, and payoff monthly.

Situation: I opened (online) a money market account at my credit union to transfer excess funds ($250K) out of our checking account to make a "little" more interest. Apparently this triggered the credit union to run a credit check (without my knowledge) to see what other products/services they might offer us. I get a letter from them saying that I was denied any other offers because of "insufficient credit history", and mentioning there was no mortgage history.

Last week, something very similar happened with my husband!

Questions: Has this happened to any of you? What did/can you/I do to address this? Would opening a HELOC without drawing on it work, or would we have to actually take on debt?

Who would have thought being debt free was a bad thing!
I would go back to the credit union to find out exactly what they are talking about. Using your credit cards and paying off monthly should be more than enough credit history. The lack of a mortgage now should have no effect.

After their dissatisfactory answers, I would inform them that in one month there will be no more of your money anywhere in their credit union and move out every dime.
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Old 10-15-2021, 09:26 PM   #62
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Using your credit cards and paying off monthly should be more than enough credit history.
Enough credit history for what?
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Old 10-15-2021, 09:55 PM   #63
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Can you give some example of where you wanted to borrow money and pledged assets as collateral to secure the loan? Or are you looking to gain access to unsecured credit? Such as CC's? That's where credit scores are aimed.

Lenders only have access to information regarding your assets if you provide it. And they only care what those assets are if you are willing to pledge them as collateral.

You're right, pledging assets doesn't affect a credit score. But pledging assets as collateral would give you access to loans otherwise unavailable.

Unpledged assets don't, and shouldn't, have any impact on credit scores and unsecured loans. They're two different things jazz. You're really trying to mix oil and water.

Ok, this has taken an unintended turn so I’ll not pursue. Suffice it to say I’m not mixing anything.
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Old 10-16-2021, 03:53 AM   #64
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To be fair to the financial industry many other industries also try to maximize profits.

Look at the food industry, lots of advertisements showing fun laughing thin people eating huge calorie meals, a full days worth of calories per meal.

I cannot tell you how often at the restaurant the waitress will ask this Chubby fellow if I'd like some booze or a desert with my lunch. She is not asking me out of concern for anything other than to maximize the sale.

Bottom line is People are responsible for their actions.
You're right, of course, but the barriers to customer knowledge, the level of competition, and the need to use the industry vary widely.

Everyone needs healthcare & financial services.
No one needs to go to a restaurant.

Most people can flip the box and read the nutrition label and many cities have implemented requirements that calories go on the menu next to the price.

Most people do not have the acumen to really understand modern financial products...even though many should...they simply do not.

Net: I despise these people.
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Old 10-16-2021, 07:36 AM   #65
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We have spent the last few years working on trying to get our score over 800... And its driving me mad... We sold our home, paid off mortgage and most other debt. Bought new place with cash. In trying to work within their rules is a joke... . 20k debt with 100K limit (Random Numbers)... credit limit to high and lower score. Reduce CL to 50K... now your debt to CL is to high.. score reduced. pay off half the debt, close half the accounts... back to limited accounts, no mortgage and it reduces your score...
2 secure accounts, 5 CC/store cards ...never missed any payments in 20 years. and remained stuck in the upper 700s for years...
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Old 10-16-2021, 08:12 AM   #66
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Once I accepted the fact (IMO) that credit scoring is a scam and a sham, it was much more understandable why so many credit practices by financial institutions just don’t make sense.

As far as getting denied for something that you did not apply for, the letter you received sounds familiar. I bought a used car from a dealer and paid with a personal check. I was in the middle of a home refi and did not want any activity on my credit file from a car dealer. A month later i got a denial letter from the dealer. Anyone reading the letter would assume I had applied for credit and been denied. It felt bad to be rejected even though I had not applied and I was furious because it could’ve screwed up my refi (it didn’t). I called the dealer and they said tendering a check entitled them to run my credit. Once they get the credit report if no action is taken it expires and the denial letter is auto generated. Stupid.
About 10 years ago I bought a used car from a dealer about 50 miles away. I negotiated a price on the phone I was good with, then asked if they would meet me somewhere between us so I could put eyes on it and test drive it, and they asked me to pick a place. I picked a restaurant that was 10 miles from me, went out with my wife, test drove it, it had checked out on Carfax, so I said I'd take it. Wrote a personal check on the hood of the car in the restaurant parking lot, and I drove it home. I don't know how they could have checked my credit since all they had was my name and phone number until we met at the restaurant but I suppose they had to have done it or they wouldn't have taken a $15K personal check from essentially a complete stranger. Didn't give it much thought until later.
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Old 10-16-2021, 09:28 AM   #67
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I have been a landlord for many years and if I had two tenant applications with one application with “no credit history” and one with a “credit history” I usually select the one application with the “less financial risk”…which is legal according to my attorney. Unfortunately the application with a credit history of paying past debts demonstrate less financial risk to me.

Even if you knew the no credit history person had saved $1M and the other was living paycheck to paycheck?
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Old 10-16-2021, 10:46 AM   #68
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We have spent the last few years working on trying to get our score over 800... And its driving me mad... We sold our home, paid off mortgage and most other debt. Bought new place with cash. In trying to work within their rules is a joke... . 20k debt with 100K limit (Random Numbers)... credit limit to high and lower score. Reduce CL to 50K... now your debt to CL is to high.. score reduced. pay off half the debt, close half the accounts... back to limited accounts, no mortgage and it reduces your score...
2 secure accounts, 5 CC/store cards ...never missed any payments in 20 years. and remained stuck in the upper 700s for years...
I don't know what a secure account is, I once when I had zero credit score got a secured CC (pay in advance on CC, then use the CC) for months until they relented and gave me a low limit CC.

This does sound annoying, but I don't really pay much attention to my credit score. I was paying off fully my CC around every 2 weeks as didn't want to accidentally miss a payment.

Missing a payment on anything can be bad for the score.

I have improved my score by setting 2 of my cards on auto-pay so they pay the statement balance (not fully balance) as it's due. This is because CC companies "look" at some random time what my CC debt is at. When I was paying off fully, it could have been zero at that time, showing no usage.

I feel store CC are pretty useless, I have a Kohl's one only because of the coupons they send. I got rid of the rest of my store CC's as the limits are low, and yet count as another open account. Besides I get better rewards from a regular CC.

Not sure why you care about the score so much, as high 700's is as good as 825.
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Old 10-16-2021, 10:50 AM   #69
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Originally Posted by vchan2177 View Post
I have been a landlord for many years and if I had two tenant applications with one application with “no credit history” and one with a “credit history” I usually select the one application with the “less financial risk”…which is legal according to my attorney. Unfortunately the application with a credit history of paying past debts demonstrate less financial risk to me.
I used credit reports to screen for my tenants, I found the report details more important than a simple score.

  1. It made it easier to see the flashy, new car, well dressed folks "forgot" to pay some debts.
  2. The couple with older car, husband lost his job, paid their debts all the time for decades.
I took #2 as tenants, and they have been great tenants for ~20 yrs
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Old 10-16-2021, 12:53 PM   #70
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We have spent the last few years working on trying to get our score over 800... And its driving me mad... We sold our home, paid off mortgage and most other debt. Bought new place with cash. In trying to work within their rules is a joke... . 20k debt with 100K limit (Random Numbers)... credit limit to high and lower score. Reduce CL to 50K... now your debt to CL is to high.. score reduced. pay off half the debt, close half the accounts... back to limited accounts, no mortgage and it reduces your score...
2 secure accounts, 5 CC/store cards ...never missed any payments in 20 years. and remained stuck in the upper 700s for years...
Not surprised your efforts were not effective. There is probably no difference whatsoever between an 850 score and a 760ish score but many fincos try to brainwash us to think it's critical. All I ever do is pay my bills on time and I have good scores. At one point we had very high levels of debt (at very low interest rates) and our scores were in the low 700's. We never got declined for anything and never paid higher loan or insurance rates.

If you want to pursue the >800 credit score game you could try using the "what if" simulator on the Chase Bank credit card website. I think it's called Credit Journey or some such. Its free to anyone.
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Old 10-16-2021, 04:17 PM   #71
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If I wanted health insurance, would it be cheaper if I was always getting ill and then getting better, or would it be cheaper if I was never ill ?
If I wanted a loan, would it be cheaper if I was always getting into debt and then getting out of debt, or would it be cheaper if I was never in debt ?
A strange world ?
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Old 10-16-2021, 06:49 PM   #72
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Even if you knew the no credit history person had saved $1M and the other was living paycheck to paycheck?
Having $1M saved may not be relevant according to most credit rating bureaus. It may count if that person has the $1M deposited in a specific bank and you apply for a loan to that same specific bank. I also have no way of validating the $1M deposit since deposits are not public records.

A Credit rating is just that. It does not rate you on how much money you saved or whether you are debt free. You get a credit score on how much you borrow and your credit history of paying back the loan. Living paycheck to paycheck is also meaningless because that information is usually confidential. If it is recorded somewhere, then there are some privacy issues. I do require that the rent is no more than 1/3 of the tenant's income which is a standard practice by most lenders for a mortgage application and I do require a copy of his last two pay stubs. What the tenant does with the other 2/3 of his/her income is none of my business.

In answer to your question, yes I would chose the person with a better credit score. This is because if I get sued, I can defend myself because the winning applicant has a higher credit score. If I ever select a tenant with a lower tenant score, I can potential lose a bunch of money to the plaintiff with a higher credit score. As I stated previously, I consulted an attorney before getting into this business. Sometimes you have to make decisions based on the better court outcome than common sense.
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Old 10-16-2021, 06:51 PM   #73
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I don't know what a secure account is,
I'm meaning something like a car loan... secured as they can repo it...
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Old 10-16-2021, 07:33 PM   #74
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Let me get this straight: you want to open an account in a credit union and put large amount of cash in it, essentially lend the money to the credit union with <1% and they denied your request?

That shows their incompetency and you are lucky you dont have to learn that the hard way.

Just find another credit union.
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