Being debt free is bad?

[SAHW]

I admit I lurk but recently something happened that I felt I had to shout about.

A little background - we became debt free in 2000 when we paid off our house and land. A few months later I checked our credit reports to make sure they reflected this fact. Our mortgage company showed we had been VERY late with one payment - totally false. I pulled my records and low and behold discovered that the month they said we were late they did not even own our mortgage, they took it over the next month. Luckily I had proof of this and after many calls and letters it was cleared up. But that is not my current point.

We have a Mastercard we use for buying gas at the pump and emergencies. I total our tickets and pay them before the bill even arrives - great credit right? Wrong. We requested a credit line increase a couple of weeks ago and last week were turned down. The reason, not enough credit reflecting regular payments on our report. So, paying early, paying extra and not owing anyone was not good enough. The fact that we always pay them in full was not good enough. DH says they don't like people like us because they don't make interest off us, yet they do pay a 1% rebate in Phillip 66 products. :

I will add that a friend ran a current credit report and score for us and DH's is 791 and mine is 796 so that is not the problem. The friend, who is a loan officer, said it is not uncommon for a woman's score to be higher than her husband's since he usually has more credit items.

SAHW
Stay-At-Home-Wife

 

[Mr._johngalt]

Hello SAHW! "Lurking" can be fun!

I have run into many situations in my checkered past
when it appeared to me that the more you borrowed the
more you were able to borrow, even if your history was
not without blemish. Just an observation.

 

[Cut-Throat]

Something is amiss here. Not a day goes by where I don't get an offer for a credit card in mail box with zero interest for 6 months.

I too am debt free (no mortgage either) , and have not paid any credit card interest for over 21 years! -

Apply for another card, if your story is true, there is a credit card company willing to give you a credit line that will put you in the poor house.

 

[SAHW]

Cut-Throat - I assure you my story is true and for your information we too get offers daily. They are thrown in the trash. To be honest, I am insulted that you would think I am lying. Maybe I will just go back to lurking (if even that now) and keep my mouth shut like I have been doing.

 

[Mr._johngalt]

We might give cut-throat a little slack. Although he tends to be a bit hyperbolic on most issues, he is
right about one thing. When it comes to getting
credit/credit cards, it seems to me there is always
someone willing to shower you with cash. My taxable income is
way below the poverty line. Yet, I could borrow my
way through life until my demise. Unless you have one
foot in bankruptcy court, you can borrow money. I
guarantee it.

 

[Ted]

Speaking as a regular contributor, I'm happy to see posts by anybody who is reasonably sane :-/

One thing to bear in mind, however, that if you decide to post your ideas for the whole world to see, not everyone is going to automatically believe your "facts" or agree with your interpretations. Considering that some posts are advertisements for scams, and some are, well, irrational, it's a good thing for readers to be somewhat skeptical

 

[proud_texan]

I don't think Cut-throat was accusing you of lying.
We're all friends here....don't be so sensitive. I interpreted his message as a suggestion that you might try another credit card company...nothing more.

While we're on the subject of credit cards...and this is especially important for retirees... you can often renegotiate your interest rate on credit cards. Seriously, if you have one that's too high, call them and ask for a reduced rate. They will usually jump through hoops to keep your business.

If they refuse, just get another card. It's just old fashion horse-tradin'

 

[Mr._johngalt]

proud Texan is right! I prove it every day. You will be
amazed what people will agree to if you just have the nerve to ask.

 

[BigMoneyJim]

SAHW, I have noticed that late pays are apparently considered the worst thing by CC companies. I don't know why; I always paid, including penalties and interest, but they absolutely hate late payments. And also apparently having no regular payments (revolving debt) makes them suspicious, too. I can't figure that one out.

Have you checked all three credit bureaus? Perhaps one still has the false late pay on it. Or maybe the false late is still on your record, but they attached an explanation. I don't know, but I get the impression they still don't look favorably upon that.

I also got tagged for a false late payment once from my credit union who gets the money straight from my paycheck!

Also, typed words on any computer board are very easy to take harder than intended. Even if they are intended hard, it's one person and maybe he had a bad day. I know it can affect you personally when "flamed", but you really shouldn't worry about it.

 

[Mr._johngalt]

As far as I know my credit is rock solid perfect. Yet, I
have been turned down on my last 3 card applications.
Usually the reason given is the large amount of credit I
already have available, or my income is too low. I don't really need any more credit cards, so it is not important
to me.

 

[Cut-Throat]

johngalt,

Yup, too much credit is always a red flag for the creditors. Even if you don't owe anything at all. They're worried that you'll rack everything to the max 1 month and then move to a different country.

With no debt and enough assets, I doubt I'll ever need any credit for the rest of my life.

I use 1 credit card for convienence (pay at the pump for gas is really nice!) and tracking expenditures. Downloading all my Credit Card transactions to Quicken is very handy! I have not paid any credit card interest for over 20 years.

 

[Mr._johngalt]

I'm sure there are folks who maxed their cards and moved offshore. I can understand the appeal .

I still have around a dozen or so cards, but like
cut-throat I have paid no cc interest in 20 years or so.
About 12 years ago I bought a product line from a large
aerospace company. To finance the deal, I walked into
a bank on the way to closing and maxed out one card after another until I had enough to cover a cashier's check for the purchase price. Credit cards are a very
valuable resource for ERs and others, assuming you
have the required self control. If you do not, ER is probably not for you anyway.

 

[unclemick]

I 'pranged' my credit cards this year to put in a handicaped shower for my mother - got some some 'free'(beer only) labor' because the lake temperature was still too low for commercial crabs. Spent in febuary and debt free by august. GEnerally I only use a card at the gas pump. Second the notion that self control is the key if you want to say ER'd.