Hey baby look at my credit score, and my brand new $1400 truck payment...for which I use to haul mulch twice a year and to compensate for other areas in which I lack.
@@Bubs. good luck having to pay someone extra just bring that furniture you bought from Ikea to your house, or that new grill you got cus it can't fit in that Accord ot civic that you have
The one thing I would say is. As someone who is young, and wanting to try a house young, but wont be able to save up more than 15% or so, wouldn't a credit score give me the best rate. As someone who had a 760 and no debt, meaning it is only rising over time. Wouldn't it be best to just keep not having debt, raise my credit score, and use that rate instead of risking a higher rate with manual underwriting?
I bought a house young (22), 20% down with no credit score and I got a 2.5% rate. The rate you get is just as competitive. It turns out when they manually underwrite you and realize the ONLY people you will have to pay is them you are considered a pretty safe bet and get a good rate lol! Plus, soon as I get this house paid off I'll never need another loan cuz I ain't going back. Interest will from that day on always work on my behalf. Never again on someone else's behalf with my money.
Proverbs Chap. 13 Verse 7: "There is one who feigns riches but has nothing; one who feigns poverty but has great wealth" The former is the average American today.
One's credit score determines the interest rate you will get on a car loan and can also affect the amount you pay for insurance, etc. I have built my credit score WAY up by judiciously using credit cards for things I would buy anyway. It's paid off in full weekly, and I never pay a cent of interest or fees (and of course no annual fees!). So NOOOO, you do NOT have to have high debt to have a good credit score! My FICO score is excellent and I have NO debt. Zero, zilch, nada. I think you drank the Ramsey Kool-Aid, Mr. K.
The only reason you say you NEED a credit score is because you think that buying a car necessitates taking a loan. You don’t need a credit score to buy a car. Why? Because you’re not supposed to take out a loan.
People like points and scores. Its why publishers clearing house survives today. Dave you should have a real point system score for true money health ham it up add it to every dollar
The debt game is crazy. I have this game on my phone, it’s called Sim Company’s and it mimics the ebbs and flows of a market. It also teaches leverage but it’s a bit unrealistic where you can borrow money from other people within the game at .5% interest. Anyways, like everyone else I maxed out on the amount of leverage I could have within the game to make more money faster but growth as a percentage was slow and I often found, especially going from a boom market to a recession you’ll lose money because of the payments you have to make using leverage. Also, I wanted to see which was actually faster, carrying around the debt or paying it down and running a company on cash and I must say, since paying down almost all the debt my running total of money has been shooting to the moon. Kind of cool that there’s a game out there that can really help teach us in a more practical sense without making too many mistakes in real life
After years of trying to use a debit card and no credit card I finally had to open a credit card account for car rentals. Car rental companies even Dollar that you used to endorse requires proof of a round trip airline ticket from their airport to obtain car rental from them with debit card. Sometime I fly into one airport and out of another one so hence the need for a credit card. The other issue of your credit score moving to undetermined after 6 months of no debt or open accounts was not my experience. After over 2 years in that situation all I saw my credit score do was drop to the low 600 level and stay there. It never went to undetermined. Funny how opening a $2500 credit card line in a matter of a couple of months my score went back in the mid 700’s. I only use the card for car rentals which is around six times a year and pay off early. I really wanted to not support the credit card industry but can’t get past the rental car loophole.
The problem for me right now is that I have a credit score. I'm now debt free with 3 months of expenses for emergencies. I wish to buy a house in the next 2-3 years. But my credit score will stay for the next 6 years.
Not a problem. You just probably won't need to do manual underwriting because you have a credit score (unless - you don't need to mention here-the debt was so bad that it's a poor score).
Try renting a nice apartment without a credit score, or try to get a job requiring a federal security clearance.... everyone can't get a job with the Ramseys
@GeorgeKamel true you can "pass" a security clearance, but many of the jobs that require them look at and review credit history, and if you're a relative ghost, it will raise flags. Also, I just went through assisting my daughter rent an apartment in downtown Boston...and yes, as she is a new grad with no real credit (though a $50k+ job, it still required me to submit all my credit his to co-sign. Maybe people can get away with being a credit ghost, but when you take on rent, utilities and any other regular paid necessities people are building a credit history score for themselves whether they like it or not. I understand the abhorrence to debt as I watch many Ramsey Inc related UA-cams, TV shows on cable, and your Happyhour podcast, but just like with alcohol to kids, teaching abstinence and expecting abstinence for a lifetime are two different things, and the reality for most people is to teach responsible use of things like debt and how to use good credit to help expand one's horizons and potential whether it be a house, car, trip, etc...just like a little drinking with a friend talking smart money might not be the best decision as to your health, but is fine in responsible moderation, unless a person has a problem and abstinence is called for. "Not a sermon, just a thought" - Pastor Lon Solomon
I paid off my mortgage two months ago. I pay my credit card bill in full each month but now am paying it on the day the month’s balance is emailed to me (instead of 25 days later on the day the next bill is emailed). I have no debts beside monthly utilities, groceries, etc., and those are kept at a minimum. Tata! My credit score is very good but dropping! I have lines of credit on several cards (unused) so I’m a customer in great standing. What the heck? While I don’t anticipate getting loans, etc., going forward (age 70), the idea of being deemed less credit worthy than over leveraged people astounds me.
the Credit Invisible are largely very poor people and/or 18-20 yr olds (75% of this age group is credit invisible). It has nothing to do with people ridding their lives of debt. and that number has been "1 in 10" since the beginning of credit scores.
I think to say canceling your credit score is going to make your life better is a bit of a stretch for some. As someone who has bought and sold a home, cars and has had to move a lot due to my military job; keeping and using my available credit has made my life much more manageable during those times. I have made payments on my CC’s every single month for years when there is a balance or I pay them off as soon as I can. I only have a 4% APR on them so it does play a big role in my usage on them for items that I would rather pay over a month or so from my paycheck rather than dipping into the slush fund to pay. It helps keep my score within the 10% credit utilization without putting me into financial hardship like most people have with an APR closer to 20-26%. Can I pay for everything out of my bank account? Absolutely. But I don’t always want to put my Debit info out there. As far as moving cost, I love using my CC or AmEx while PCS’ing because I rack up A LOT of points and benefits. I get front loaded for 80% of the moving cost so that gets put onto the AmEx as a credit, we use that as sparsely as needed to move and the last 20% is just a free bonus for our move. I gain a massive credit boost while paying for everything like a debit card.
Times are uncertain, the market is out of control, and banks are gradually failing. I was really hopeful of my investments this year, but all my plans have been disoriented, I've been studying the stock market and I realized some investors made a fortune from the recent recession and I was wondering if such success rate could be achieved in this present market. Any recommendations?
What Ramsey personalities don't tell you is that you can have a high credit score with zero debt. George spent about two seconds on how the credit score is used in other ways other than obtaining debt, but those other uses are extremely important, such as employment, housing, utilities, insurance, just to name a few. Also what George isn't telling you is that Churchill Mortgage pays Ramsey Inc. a hefty advertising fee for him to push manual underwriting. Funny how that works. Drink the Ramsey KoolAid at your financial peril....
Here in Finland there is no such thing as a credit score. There is a register where you can see if someone has payments in collections, have gone bankrupt or have been deemed to neglect payments in court, but nobody give you a score. Having multiple credit cards is actually considered a risk, not an asset!
If people knew how to use debt they would get way further ahead. Problem is. most people don't know how to use it. Thus it becomes a detriment rather than a benefit. Video was good, message was good as well for the general pop but blanket statement that its bad is misinformed or purposefully ignorant.
@@Superhyperaktive CC companies make money off our yearly fees as well as all the charges for merchants to use their service. Would they make less? ofc. Are interest payments their only revenue source? Absolutely not.
@Tunechi65 How is he a scammer when he's been helping people get out of debt for years? Of the people who use cc, what is the average debt they owe on them?
While I do agree that the credit score is a broken score system that relies on debt payments, I still use credit cards to earn cash back. I’m a meticulous budgeter, and I only use my cards when I know I can afford to make my purchase in cash, which allows me to earn money back from purchases I would’ve made regardless of the payment method I used. Just this year I received almost $700 in cash back, where I would’ve received nothing if I were to use my debit card (which I only use to get cash from an ATM)
@@HeathenwoodOfficial Well the majority of my cash back came from sign-up bonuses (I got $350 from Navy Federal after spending $3,000 in 3 months, $200 from Citi after spending $1,500 in 6 months, and I’m working on one from American Express where I’ll get $150 when I spend $1,000 in 6 months), and the purchases that were “needed” were gas, groceries, insurance, other household goods, and the occasional oil change (I would include internet but my roommate pays that, and I just send him my half). I also spend money on my wants because I don’t have any debt (I don’t carry credit card balances from month-to-month), my emergency fund is fully-funded and I’m investing. So I’d say about 60% of the spending was my “needs” and 40% were from the things I want/enjoy
You can also buy things you don't need with a debit card. The only difference is that you won't buy something you can't afford with debit. @@HeathenwoodOfficial
@@HeathenwoodOfficial depending on the type of credit card he has you can receive a lot of money on purchases just by the percentage of cash back on the item alone; how you spend and number of people are in the house hold. Take groceries, some offer 6 parentage cash back on 6000 dollars on groceries which is equaled to 360 dollars. Then there can be cash back on gas, which might be 3 precent or 6 precent, and cash back on transit and ride share apps. It is quite easy to save that much money on credit cards on needed every day items.
This is incorrect. You don't need debt to have a good credit score. If you study how then you can learn how to work the FICO algorithm to get a good credit score with no debt. Graham Stephen has some great videos on this. Also buying a used car with cash is not possible for most people especially these days with inflation through the roof, so yeah, a good FICO does matter. And finally doing manual underwriting for a mortgage is a lot more expensive than getting a conventional loan with a credit score.
Vlaim9ng manual underwriting is more expensive is completely asinine. The entire point of shooting to dealing with a vendor that will give you a proper mortgage (15 yr fixed interest rate) is that you end up paying LESS in the long run for that house. Dave's team has already spelled out the facts of why having 20 percent doen payment to avoid PMI makes sense . It's not rocket science. Facts dont care about anyone's feelings But hey..you worry about your precious make believe fico score and take that 30 year mortgage without a down-payment ans you show us all whose boss eh? Lol
Insurance agent here. Having a good or bad credit score affects your auto and home insurance rates significantly!! Someone with a low credit score can end up paying thousands more a year. Having a high credit score and being financially responsible are not in competition with one another.
@@watuwantt uh......you'll have to elaborate. I have no clue how you've come to that conclusion. No credit score equals low credit score equals higher rates. Unless the company doesn't credit rate, and there are just a few that do, and they're typically non-standard auto companies.
Here in the UK our credit scores are marked out of one thousand. I have ZERO idea why my score is so high because I never use credit. I use the "twice/once" rule before a purchase: if I can't pay for it is twice, I don't buy it once - using cash. So if an item is £100, I'd better have £200 in my wallet. Works for me!
I'm a credit card person, so I can handle the ramifications of using em. Most people aren't (apparently more than 50% of the US), so they shouldn't get them. But in general, a "no credit score" is almost the same as having the best credit score, so as long as you can prove stability of income, and paying for non-debt liabilities (like utilities and rent).
Yup, because getting a mortgage, applying for an apartment, home and car insurance rates, turning on utilities, background checks on a new job, etc...none of those require CCs or credit checks, right?
I actaully did all of those things without a score. Not sure why your job requires a credit score. I make more than you, so perhaps your employer is idk dumb? Same thing with insurance, agents that need a credit score have no idea how insurance works. If a landlord wanted a credit score I just printed out my bank statment that showed I had more money than they did. I actually broke my landlord's idea of what a credit score means.
Actually no they don't. I've done all that with no score. Apts and jobs look for late or bad accounts not score. My car and home insurance is cheaper now that I have no score, you can buy a home with no score called manual underwriting. It's almost the same process as fha. Pulling your credit doesn't mean they are looking for high score they are looking for bankruptcy etc.
@@tduck828 my reply says some do when you have a higher finance job so I take it you skimmed my comment. I bet though if you don't have a finance job they wouldn't fire you for having no score because no score is not the same as a low score or bad score. Huge difference. They may be running your credit but again they are not watching or care about your score unless you are in high finance or in the military with a security clearance
Recent WSJ article points out that retirees with no scores pay higher insurance rates. Getting a mortgage at any stage in life without a score is also more expensive. It’s possible to maintain a score without incurring debt. Worth it to play the game - if you’re capable.
Well if it's automotive..ya 1. Shop around and I don't mean just once in your life.. Shop around every 6 months... 2. Don't drive or ride a motorized vehicle like a jackass...from the show Jack Ass. It's not rocket science ans it's not like these two things are a secret 3. Chances are ya don't need a big freaking Chevy suburban or Ford expedition. So donr buy a vehicle with a giant engine u less you're hauling heavy stuff for your income. Boom..those three things alone just nuked the vast majority of reasons why you're paying too much for insurance. 4. If you're under 25..well that can't be helped..get under moms or dads insurance plan . At 25..your Insurance cost goes down
I use Zander Insurance and they use independent brokers who shop a bunch of top rated companies for the best deal. There are many other factors that go into your rate outside of credit score
Why? You ask why? GK, life is 1000% easier with a credit score. The problem is not the score, the problem is that there is, and always will be, a segment of society that can't or won't pay up. And that's why we score people, to weed out the non-payers.
@@vectorhacker-r2 ummm.... You need to watch George's video how he BECAME a millionare. He's not biased at all. Even if you don't invest heavily, being debt free is always going to make humans feel better than carrying around a lofty loan with a high credit score.
@@GeorgeKamel Not brainwashed. I understand that there is a difference between expenses and debt - but you don't. I use a CC, therefore I have a credit score. I pay it off every month, thanking the bank in Delaware that loaned me money interest free for ~40 days. My CC is an expense, just like my utilities and taxes are, I respect Ramsey, but he leaves no room for those of us responsible consumers who shun debt, but also use the system to our advantage.
Yup, its stupid. Since you paid off the loan, that means the "account" is closed. So your "total credit limit" (including home loans, auto loans, and credit card limits) lowered. And that affects your score. And since its a recently closed account, it also affects your score.
The Credit bankers won't have debt so they won't have a credit score even though they tell us we need to keep on having debt to have a credit score! It is a way of keeping people indebted whilst the bankers grow rich at our expense.
Going to add another point from my perspective. I grew up on Dave Ramsey and was convinced that the credit score was not required for anything. I successfully rented cards, and was able to rent with no score. But then several years ago I got slapped into reality when I was moving and found that no place in the new city would rent to me because my credit score was indeterminate. I ended up finding a place that would rent to me but they required a double deposit, were in a worse location, and cost more per month than some of the other places I had been looking at. TL:DR; having a good credit score gives you options, and in my case the opportunity cost of not having it was incredibly high. Plus, to get a perfect credit score is incredibly simple and doesn't require ever paying a dime in interest. Just get a credit card with a low limit, put an expense that you are not going to overpay for on it (like gas), and pay it off in full every month. Within a year you'll have a score > 740 which is considered a perfect score for all purposes. Anyway, just beware of this, especially if you are young or still renting. I love Dave, but this is an area where he is just plain wrong on the practical side of things. I would love a world where you don't need a credit score to rent. But unfortunately that's not the world we currently live in.
Yes, the cities are where the credit score thing really affects you for renting. My first apartment was in a rural area. Month to month, handshake from landlord. My second apartment before I bought a house ran a credit check and everywhere in this area nearer the city does it that way. It's also a bloodbath to get an apartment, so having no score really reduces someone's chances of getting decent housing.
To a point… I’d love to see how you work around getting renting an apartment and also deal with employers or utilities companies looking at your credit score.
In my experience most apartments and utility companies will just want a slightly higher deposit and employers have never looked at my credit score(I don't know why they would?). It's mildly inconvenient but if you're good with your money it doesn't really matter.
utility companies require a large deposit if you don’t have credit insurance companies require automatic ACH and a larger down payment credit score is still important without loans
All hail almighty FICO! Lol. Totally kidding of course. I'm debt free and always will be! Love your content Goerge. If you are ever in kansas, we will treat you to lunch. The Ramsey show has changed my life!
I have a credit score well over 800. I use a cash back credit card for all purchases. I have paid $0 in interest and fees in 40 years. I have no real debt, and am a multimillionaire many times over. You don't need to be "in debt" to have an extremely high credit score.
Credit scores just have sooo many errors. And you are not the customer but the product. My husband and his brother get their credit reports mixed because of their similar name and social security numbers! And for us to buy a house and for them to buy one… we had to send 3 separate letters to outline which brother had what. At one point it looked like my husband has 6 cars! That was ridiculous. And they keep mixing it to this day.
@@jasondima1411 you can get a credit card and pay it off in full every month before interest. You don’t need to carry a balance. You can now add rental payments and utilities to your credit report via Experian boost and other similar services. Having a credit score will make your life easier. They check your credit for apartment rentals, utilities, phone services, jobs especially in the financial industry, etc. If you don’t have a score, you automatically get denied because it’s all automated now.
@@jasondima1411 btw I am not advocating for the credit scores. I agree with George that the system sucks but you have to deal with it because it’s the system that we have.
@@Ivy-wv4wdthat is just false. I have had a high score and no score and my life hasn't been harder in fact it's easier with no score because I have less monthly bills and more money. I have bought a house,gotvutilities have insurance with no score. My insurance is cheaper now that I have no score then my old 800 score.
My credit score is over 800 and I have effectively zero debt. I use a credit card occasionally (very rarely, usually for gas at Costco) and pay it off promptly. I haven’t been charged interest on my purchase for so long I lost count. But I prefer to avoid credit. It’s a pain when I have to make a payment that is from more than one line item in my budget. Our home is paid for. So now it’s just a high score. I don’t know if I want it to go away or not… but either way, it’s not my love of debt score!
Exactly! I don’t know why the Ramsey team keeps insisting this. My husband and I both have a very high score as well as my dad, and we’re far from broke. My dad is a multi millionaire.
@@libbyneefe1075 Because he is talking about the majority. A few people can manage to use a credit card well. Most can’t. A few people can leverage debt to become wealthy. Most can’t. He’s speaking to the majority.
I had no score or a low score depending on who you asked because I only had a student loan that was paid off within a month of graduating, and some apartment rental history. Getting a mortgage was a pain (only my local credit union with access to my detailed financial history were willing) and the interest rate I had was worse than it should have been. I didn't and don't care about credit scores, especially with my house paid off and with no intention of ever borrowing again, but it's obviously better to have a strong credit score when it's time to borrow for a house. Lower interest rates are better than higher interest rates, and you get those with a strong credit score, for better or worse.
For me, I only had a paid off $20k car loan for history and one open credit card I sternly treat as a debit. Plus over 7 years of employment at one place with consistent raises. Getting my mortgage last year at 23 was insanely challenging even though those two things gave me an 800 credit score no matter who you asked. Even my credit union I got the auto loan through and had all of my financial history wouldn't even consider me. I had a %50 down payment to top things off. I finally found a lender that had a good interest rate (rates were rising fast) and would pre-approve me. They made it clear, in writing, that the only reason I was approved was because of my score. I'm no credit advocate as I prefer saving and avoiding payments, but I'm %100 confident I wouldn't have gotten my home at my age without that score. I'll be keeping my score in tip top shape until I don't need a mortgage to purchase a home/land as that's all I really need it for.
It's because you got your car before getting a house...don't ask me why that matters but if you're paying on a car note, some lenders think that if it came down to paying your mortgage or your car, you would pick your car so that's considered riskier to them than if you already paid off your car. Also 50% down payments aren't what banks prefer. They want to be able to keep you in a loan longer because they only make their money off interest payments. I always say that even if you have 50% down...only put 20% and then after you make your first mortgage payment, make another payment right after with the rest of the 30% you didn't put down and apply it to the principal. You get the same results with more than likely a lower interest rate. Lenders practically want people who cannot afford the home to get a mortgage. They don't like people who can pay the house of quickly...they want to make money. @@caden01691
@soulanstreets Car was paid off for like three years before ever applying for a mortgage. You're %100 correct about them not wanting someone to pay it off quick so they can milk the interest. My credit union said they wouldn't approve me for said mortgage because I only had one open account. (Credit card) They wanted me to have at least two accounts open to "Prove I can manage multiple accounts" but we all know it's just because people are less likely to pay a loan off quickly if they have other payments to make.
I've never ran into any ACTUAL problems with not having a credit score. Yes it's SLIGHTLY inconvenient when getting a rental car or APT, but we've made it work. I'd rather deal with the slight inconveniences than be tempted with with a credit card. I'm a HUGE spender, so I don't trust myself with a credit card honestly. It's so easy to just not have the line of credit.
@@DaRKWizaRdGaming0my wife and I stopped borrowing money and closed all our credit cards in 2020. It was the best thing we ever did. It really helped us control our money instead of wondering where it went.
I’m 50 years old never ever got a credit card never will and I turned out fine geez 🙄 I remember when the credit card companies took off I swear I had at least ten of them calling me every single day finally I couldn’t take it anymore and I went off on them I basically threatened them they didn’t like that I got a call from a office manager from the one I threatened told me I can’t threaten them I told them than stop calling me because I DO NOT WANT ANY CREDIT CARDS ENOUGH ALREADY he said you’ll never hear from us again and I never did 😁
I applied for my first credit card last summer to establish a credit score. I got approved for a $1200 limit a month later (so that line of credit is currently open) but I never activated the card. I signed up for monthly FICO reports 2 years ago. However, I didn't start seeing anything on my FICO reports till January of this year where it started me out at 725. Now as of July, it's at 742. My debt hasn't changed, my bills haven't changed. Just my job and my savings. Confused how it could continue rising like this.
I have a credit card and think it is important for these reasons: 1. I get the highly cherished cash back 2. I get opening bonuses for new cards 3. Having a good credit score doesn't mean I am good with debt or money. I will give you that. But I think having a low credit score means you are bad with money. 4. At 4:50ish I didn't know that was how it was. I pay off my cards early before each statement and keep my utilization near 0%. Personally I thought that meant it had no effect on my credit score/was a good thing for it.
When moving to the US it was a big issue for me to rent a good house, because I didn't have any credit score. Some of the renters wanted up to 6 months up front payment, some just plainly didn't want to rent.
I am debt free. My credit score has dropped. Not much. How do I get the credit score to zero? I have never closed any old credit cards. They eventually close them for me. Love your help!
You must close all accounts to start the clock on the score becoming indeterminable. Don’t wait on someone to close them. 6-12 months after that, your score will become indeterminable
It is time for me to run my annual credit report. Is that the best way to figure out what accounts are still open? I have no idea which ones are still open. Thank you
George, I do think there is some grey area where you can be responsible and budget effectively while using a credit card as a proxy between your purchases and your actual money, but I also agree that credit scores and credit card companies are dumb! great video!
@@GeorgeKameluntil your debit card is hacked and someone has direct access to your bank account. Personally prefer the added security of the credit swipe
This is a serious question. I promise I'm not trolling. I'm not a home owner just yet, and I rent. I have watched videos about how to get a mortgage without a credit act, but how do you get approved to rent an apartment without a credit score? Does anyone know of a particular form that can be applied to this situation, or maybe sending a letter to your prospective landlord explaining that you are debt free will do? I'm just curious if anyone has experienced this.
They check for bad/low credit. No credit is far less of an issue. Sometimes there may be a higher deposit or first and last months rent, but that’s it.
I mean, if you’re responsible.. having a good credit score makes things easier. Good luck going a no credit score mortgage and getting beat by someone who finishes the process faster.
The only problem is having a credit score is essentially necesssary if you plan to move. You're not getting a mortgage without one and so many landlords run credit checks now.
While you mention insurance, you kind of gloss over it and you make a few miss statements. Your credit score will severely impact your insurance cost and your ability to be bonded. While it is possible to get around most bonding requirements by putting up the cash equivalent, it is not always feasible. Someone with good credit can pay up to half compared to someone with no credit and even more savings compared against someone with bad credit. Also, you can obtain and maintain an 800+ credit score and not be in any debt whatsoever and not pay a penny in interest or finance charges of any kind. To imply you have to be in debt to get or maintain a high credit score is just wrong. I have no debt of any kind and I have a 800+ credit score. While I do have credit cards, I never carry a balance and I never pay interest. I fully understand the argument that people with a credit card have a tendency to spend more, but that can be overcome by creating and sticking to a budget. I am not trying to convince you to use credit cards or anyone else, I just want to see more accurate statements in regards to a credit score.
My spouse has one of those fancy dancy clearances. Didn't need a credit score for it. Not having debt also makes the SF-86 paperwork a breeze. Nothing to hide and nothing to worry about.
@@GeorgeKamel You got it. Keep up the great videos! I will say that the one pain point with the clearance paperwork is that the employer does make us report every retirement related financial transaction outside my wife's employer retirement accounts. I believe this is because of the potential conflict of interest between employer and government. They need to know what we are invested in...so for example every time our Smartvestor Pro makes a transaction with our Roth IRAs it has to be run against a list of what the company does/doesn't allow us to be invested in.
George I've had very high finance positions in the past and they check score and history YEARLY. If you didn't hit certain parameters you no longer were employed. It can and does happen. Just because you don't think it does, absolutely does not make it not true..
Hey baby look at my credit score, and my brand new $1400 truck payment...for which I use to haul mulch twice a year and to compensate for other areas in which I lack.
Haha nailed it 😂
@@GeorgeKamelwe ALL have THAT neighbor 😂
Having trucks are wroth it, in the long run
@@condog209sounds like something someone with a mini condog would say ngl
@@Bubs. good luck having to pay someone extra just bring that furniture you bought from Ikea to your house, or that new grill you got cus it can't fit in that Accord ot civic that you have
The one thing I would say is. As someone who is young, and wanting to try a house young, but wont be able to save up more than 15% or so, wouldn't a credit score give me the best rate. As someone who had a 760 and no debt, meaning it is only rising over time. Wouldn't it be best to just keep not having debt, raise my credit score, and use that rate instead of risking a higher rate with manual underwriting?
For clarification, I mean 15% of the house purchase price, in the time before I want to buy it.
I bought a house young (22), 20% down with no credit score and I got a 2.5% rate. The rate you get is just as competitive. It turns out when they manually underwrite you and realize the ONLY people you will have to pay is them you are considered a pretty safe bet and get a good rate lol! Plus, soon as I get this house paid off I'll never need another loan cuz I ain't going back. Interest will from that day on always work on my behalf. Never again on someone else's behalf with my money.
@@ninjack8973how old are you now
You just sound like you wanna buy a house faster than you can afford. Dont rush
Car insurance rates are based off your credit score too.
Not true. My insurance has gone down in price now that I have no score.
Depends on state. Some allow and some do not.
Just paid off my rental property. My FICO is dropped 20 points quick...come on undetermineable.
Routing for you! 😎
Very proud to announce that I do not have a FICO score. 👍🏻🙌🏻👏🏻
Proverbs Chap. 13 Verse 7: "There is one who feigns riches but has nothing; one who feigns poverty but has great wealth" The former is the average American today.
One's credit score determines the interest rate you will get on a car loan and can also affect the amount you pay for insurance, etc. I have built my credit score WAY up by judiciously using credit cards for things I would buy anyway. It's paid off in full weekly, and I never pay a cent of interest or fees (and of course no annual fees!). So NOOOO, you do NOT have to have high debt to have a good credit score! My FICO score is excellent and I have NO debt. Zero, zilch, nada. I think you drank the Ramsey Kool-Aid, Mr. K.
Jokes on you, I’ll never need a car loan and I get great rates on insurance.
The only reason you say you NEED a credit score is because you think that buying a car necessitates taking a loan.
You don’t need a credit score to buy a car. Why? Because you’re not supposed to take out a loan.
"feeling knotty" made me laugh more than it should have....lol
When you pay off your student loans your credit score goes up. Maybe more people should try it.
😂 genius marketing angle
That's what I had to do before getting a loan from the bank.
Mine actually went down because it was considered closing an account…oh well
@@kevalevathey were being sarcastic so people can actually pay for their student loans instead of holding it for 20 years for it to fall off.
My name is Christopher and for once my eyes widened when I heard George say my name 👀 Hi George!
People like points and scores. Its why publishers clearing house survives today. Dave you should have a real point system score for true money health ham it up add it to every dollar
The debt game is crazy. I have this game on my phone, it’s called Sim Company’s and it mimics the ebbs and flows of a market. It also teaches leverage but it’s a bit unrealistic where you can borrow money from other people within the game at .5% interest. Anyways, like everyone else I maxed out on the amount of leverage I could have within the game to make more money faster but growth as a percentage was slow and I often found, especially going from a boom market to a recession you’ll lose money because of the payments you have to make using leverage. Also, I wanted to see which was actually faster, carrying around the debt or paying it down and running a company on cash and I must say, since paying down almost all the debt my running total of money has been shooting to the moon. Kind of cool that there’s a game out there that can really help teach us in a more practical sense without making too many mistakes in real life
Credit score just means you can make payments. Doesnt mean you handle money well.
hmmm, time to go fishin (need some summer R&R anyway)
Great info George, though I'm fine with having a few CCs that are used responsibly.
After years of trying to use a debit card and no credit card I finally had to open a credit card account for car rentals. Car rental companies even Dollar that you used to endorse requires proof of a round trip airline ticket from their airport to obtain car rental from them with debit card. Sometime I fly into one airport and out of another one so hence the need for a credit card.
The other issue of your credit score moving to undetermined after 6 months of no debt or open accounts was not my experience. After over 2 years in that situation all I saw my credit score do was drop to the low 600 level and stay there. It never went to undetermined. Funny how opening a $2500 credit card line in a matter of a couple of months my score went back in the mid 700’s. I only use the card for car rentals which is around six times a year and pay off early.
I really wanted to not support the credit card industry but can’t get past the rental car loophole.
The problem for me right now is that I have a credit score. I'm now debt free with 3 months of expenses for emergencies.
I wish to buy a house in the next 2-3 years. But my credit score will stay for the next 6 years.
Huh? Why would your credit score stay for the next 6 years?
@@GeorgeKamel Is'nt the credit history 6 years...? Maybe i got misinformed..!
Not a problem. You just probably won't need to do manual underwriting because you have a credit score (unless - you don't need to mention here-the debt was so bad that it's a poor score).
Try renting a nice apartment without a credit score, or try to get a job requiring a federal security clearance.... everyone can't get a job with the Ramseys
Someone commented that their spouse had no credit score and had no issue getting high clearance. Myth
@GeorgeKamel true you can "pass" a security clearance, but many of the jobs that require them look at and review credit history, and if you're a relative ghost, it will raise flags.
Also, I just went through assisting my daughter rent an apartment in downtown Boston...and yes, as she is a new grad with no real credit (though a $50k+ job, it still required me to submit all my credit his to co-sign. Maybe people can get away with being a credit ghost, but when you take on rent, utilities and any other regular paid necessities people are building a credit history score for themselves whether they like it or not.
I understand the abhorrence to debt as I watch many Ramsey Inc related UA-cams, TV shows on cable, and your Happyhour podcast, but just like with alcohol to kids, teaching abstinence and expecting abstinence for a lifetime are two different things, and the reality for most people is to teach responsible use of things like debt and how to use good credit to help expand one's horizons and potential whether it be a house, car, trip, etc...just like a little drinking with a friend talking smart money might not be the best decision as to your health, but is fine in responsible moderation, unless a person has a problem and abstinence is called for.
"Not a sermon, just a thought" - Pastor Lon Solomon
Why would you let your daughter live in an apartment? Don't you love her? Apartments are not fit for human habitation. @@Kornheiser10
I paid off my mortgage two months ago. I pay my credit card bill in full each month but now am paying it on the day the month’s balance is emailed to me (instead of 25 days later on the day the next bill is emailed). I have no debts beside monthly utilities, groceries, etc., and those are kept at a minimum. Tata! My credit score is very good but dropping! I have lines of credit on several cards (unused) so I’m a customer in great standing. What the heck? While I don’t anticipate getting loans, etc., going forward (age 70), the idea of being deemed less credit worthy than over leveraged people astounds me.
A girl I would have married yesterday called me Dave Ramsey as a slur. So no, don't put it on a dating site.
It’s really not that hard to have an excellent credit score. I have zero debt of any kind and my score is a steady 825 for many years.
Yes it is, because there is no such thing as an excellent credit score.
the Credit Invisible are largely very poor people and/or 18-20 yr olds (75% of this age group is credit invisible). It has nothing to do with people ridding their lives of debt. and that number has been "1 in 10" since the beginning of credit scores.
You will note that credit scores only exist in backwards countries like the USA. They are one of many reasons the rest of the world laughs at America
I think to say canceling your credit score is going to make your life better is a bit of a stretch for some.
As someone who has bought and sold a home, cars and has had to move a lot due to my military job; keeping and using my available credit has made my life much more manageable during those times. I have made payments on my CC’s every single month for years when there is a balance or I pay them off as soon as I can. I only have a 4% APR on them so it does play a big role in my usage on them for items that I would rather pay over a month or so from my paycheck rather than dipping into the slush fund to pay. It helps keep my score within the 10% credit utilization without putting me into financial hardship like most people have with an APR closer to 20-26%. Can I pay for everything out of my bank account? Absolutely. But I don’t always want to put my Debit info out there. As far as moving cost, I love using my CC or AmEx while PCS’ing because I rack up A LOT of points and benefits. I get front loaded for 80% of the moving cost so that gets put onto the AmEx as a credit, we use that as sparsely as needed to move and the last 20% is just a free bonus for our move. I gain a massive credit boost while paying for everything like a debit card.
Times are uncertain, the market is out of control, and banks are gradually failing. I was really hopeful of my investments this year, but all my plans have been disoriented, I've been studying the stock market and I realized some investors made a fortune from the recent recession and I was wondering if such success rate could be achieved in this present market. Any recommendations?
Cryptocurrency crashed the last couple years, so it should be starting a new run to a new high.
@@RandyPelletier checked for your FA and found her web page. she is very impressive , I wrote her and I'm waiting on her reply.
Are you struggling with BAD CREDIT ?
I was able to get rid of all negative items on my credit report in 14 days.
*BRANDON CREDIT FIX LLC*
Thanks for sharing, will definitely look them up.
If you don't have any debt, you won't have any bad credit. You don't need to fix your credit. You need to get rid of it.
Do you want to get rid of NEGATIVES on your credit report in 14 days?
*Brandon Credit Fix LLC*
They fixed my credit report fast to 800+
You only need that if you want to continue to be in debt and be a slave to debt.
What Ramsey personalities don't tell you is that you can have a high credit score with zero debt. George spent about two seconds on how the credit score is used in other ways other than obtaining debt, but those other uses are extremely important, such as employment, housing, utilities, insurance, just to name a few. Also what George isn't telling you is that Churchill Mortgage pays Ramsey Inc. a hefty advertising fee for him to push manual underwriting. Funny how that works. Drink the Ramsey KoolAid at your financial peril....
And what YOU don't tell anyone is that credit scores don't exist in civilised countries. They only exist in backwards countries like the USA.
Here in Finland there is no such thing as a credit score. There is a register where you can see if someone has payments in collections, have gone bankrupt or have been deemed to neglect payments in court, but nobody give you a score. Having multiple credit cards is actually considered a risk, not an asset!
Credit scores are an absurd concept that only backwards countries like the USA have.
have fun with no credit score in 2023. i hope you people watching this laughed.
You;ll notice that credit scores only exist in backwards countries like the USA. They do not exist in civilised countries.
I love the way Dave refers to it as an “I LOVE DEBT” score. Excellent video. If only everyone in the world understood this.
If people knew how to use debt they would get way further ahead. Problem is. most people don't know how to use it. Thus it becomes a detriment rather than a benefit. Video was good, message was good as well for the general pop but blanket statement that its bad is misinformed or purposefully ignorant.
@boostedfist, if everyone was good with credit cards, then the credit card companies would not make money and could not offer any perks.
@@Superhyperaktive CC companies make money off our yearly fees as well as all the charges for merchants to use their service. Would they make less? ofc. Are interest payments their only revenue source? Absolutely not.
@Tunechi65 How is he a scammer when he's been helping people get out of debt for years? Of the people who use cc, what is the average debt they owe on them?
I couldn't care less what my credit score is.
The $250K house across the street is for sale today, $50K.
You have a standing loan for $100K, Signature only.
That debt to cocaine bear analogy was spot on.
While I do agree that the credit score is a broken score system that relies on debt payments, I still use credit cards to earn cash back. I’m a meticulous budgeter, and I only use my cards when I know I can afford to make my purchase in cash, which allows me to earn money back from purchases I would’ve made regardless of the payment method I used. Just this year I received almost $700 in cash back, where I would’ve received nothing if I were to use my debit card (which I only use to get cash from an ATM)
Agree.
How much did you spend to get the cash back and how many of those purchases were needed?
@@HeathenwoodOfficial Well the majority of my cash back came from sign-up bonuses (I got $350 from Navy Federal after spending $3,000 in 3 months, $200 from Citi after spending $1,500 in 6 months, and I’m working on one from American Express where I’ll get $150 when I spend $1,000 in 6 months), and the purchases that were “needed” were gas, groceries, insurance, other household goods, and the occasional oil change (I would include internet but my roommate pays that, and I just send him my half). I also spend money on my wants because I don’t have any debt (I don’t carry credit card balances from month-to-month), my emergency fund is fully-funded and I’m investing. So I’d say about 60% of the spending was my “needs” and 40% were from the things I want/enjoy
You can also buy things you don't need with a debit card. The only difference is that you won't buy something you can't afford with debit. @@HeathenwoodOfficial
@@HeathenwoodOfficial depending on the type of credit card he has you can receive a lot of money on purchases just by the percentage of cash back on the item alone; how you spend and number of people are in the house hold. Take groceries, some offer 6 parentage cash back on 6000 dollars on groceries which is equaled to 360 dollars. Then there can be cash back on gas, which might be 3 precent or 6 precent, and cash back on transit and ride share apps. It is quite easy to save that much money on credit cards on needed every day items.
I don’t know who edits this but Dave’s not paying them enough 😂
This is incorrect. You don't need debt to have a good credit score. If you study how then you can learn how to work the FICO algorithm to get a good credit score with no debt. Graham Stephen has some great videos on this.
Also buying a used car with cash is not possible for most people especially these days with inflation through the roof, so yeah, a good FICO does matter.
And finally doing manual underwriting for a mortgage is a lot more expensive than getting a conventional loan with a credit score.
Vlaim9ng manual underwriting is more expensive is completely asinine.
The entire point of shooting to dealing with a vendor that will give you a proper mortgage (15 yr fixed interest rate) is that you end up paying LESS in the long run for that house.
Dave's team has already spelled out the facts of why having 20 percent doen payment to avoid PMI makes sense
.
It's not rocket science. Facts dont care about anyone's feelings
But hey..you worry about your precious make believe fico score and take that 30 year mortgage without a down-payment ans you show us all whose boss eh? Lol
The best possible score is no score.
Just pay cash. 😉
Insurance agent here. Having a good or bad credit score affects your auto and home insurance rates significantly!! Someone with a low credit score can end up paying thousands more a year. Having a high credit score and being financially responsible are not in competition with one another.
There's no better credit score than ZERO
What does a low credit score have to do with an indeterminable credit score?
You can get a good rate for having no credit score. Do not confuse having NO credit score to LOW credit score
@@watuwantt uh......you'll have to elaborate. I have no clue how you've come to that conclusion. No credit score equals low credit score equals higher rates. Unless the company doesn't credit rate, and there are just a few that do, and they're typically non-standard auto companies.
Nope. Big difference between low and no. @@KevinWilliams-o5v
So if your score is low it hurts you? But you don’t need a credit score?? I don’t totally agree with this George.
The best possible credit score is ZERO
Here in the UK our credit scores are marked out of one thousand.
I have ZERO idea why my score is so high because I never use credit.
I use the "twice/once" rule before a purchase: if I can't pay for it is twice, I don't buy it once - using cash.
So if an item is £100, I'd better have £200 in my wallet. Works for me!
If you have a mortgage you'll have a score also if you use a credit card at all you'll also have a score
I'll give you credit for this one, George.
I'm a credit card person, so I can handle the ramifications of using em. Most people aren't (apparently more than 50% of the US), so they shouldn't get them.
But in general, a "no credit score" is almost the same as having the best credit score, so as long as you can prove stability of income, and paying for non-debt liabilities (like utilities and rent).
Yup, because getting a mortgage, applying for an apartment, home and car insurance rates, turning on utilities, background checks on a new job, etc...none of those require CCs or credit checks, right?
I actaully did all of those things without a score. Not sure why your job requires a credit score. I make more than you, so perhaps your employer is idk dumb? Same thing with insurance, agents that need a credit score have no idea how insurance works. If a landlord wanted a credit score I just printed out my bank statment that showed I had more money than they did. I actually broke my landlord's idea of what a credit score means.
Background checks ?! 😂 Require credit cards?! Thats wild where do you work? Never seen that before
Actually no they don't. I've done all that with no score. Apts and jobs look for late or bad accounts not score. My car and home insurance is cheaper now that I have no score, you can buy a home with no score called manual underwriting. It's almost the same process as fha. Pulling your credit doesn't mean they are looking for high score they are looking for bankruptcy etc.
Wrong. My job checks my score and history yearly.
@@tduck828 my reply says some do when you have a higher finance job so I take it you skimmed my comment. I bet though if you don't have a finance job they wouldn't fire you for having no score because no score is not the same as a low score or bad score. Huge difference. They may be running your credit but again they are not watching or care about your score unless you are in high finance or in the military with a security clearance
I want a woman who will fish with me.
Love this, George and your work! I just started following Ramsey and love your advice. Do you have any resource/partners for Canada?
I know. I don't need it, but I like it.
Need assistance with your credit score? Have you recently had your application for a credit card, house, or auto loan denied?
Recent WSJ article points out that retirees with no scores pay higher insurance rates. Getting a mortgage at any stage in life without a score is also more expensive. It’s possible to maintain a score without incurring debt. Worth it to play the game - if you’re capable.
Did you say you got great insurance rates without a credit score? How
Well if it's automotive..ya 1. Shop around and I don't mean just once in your life..
Shop around every 6 months... 2. Don't drive or ride a motorized vehicle like a jackass...from the show Jack Ass.
It's not rocket science ans it's not like these two things are a secret
3. Chances are ya don't need a big freaking Chevy suburban or Ford expedition.
So donr buy a vehicle with a giant engine u less you're hauling heavy stuff for your income.
Boom..those three things alone just nuked the vast majority of reasons why you're paying too much for insurance.
4. If you're under 25..well that can't be helped..get under moms or dads insurance plan . At 25..your Insurance cost goes down
I use Zander Insurance and they use independent brokers who shop a bunch of top rated companies for the best deal. There are many other factors that go into your rate outside of credit score
Why? You ask why? GK, life is 1000% easier with a credit score. The problem is not the score, the problem is that there is, and always will be, a segment of society that can't or won't pay up. And that's why we score people, to weed out the non-payers.
My life is not 1000% harder without a score. You’ve been brainwashed to believe that. Leave the dark side and join us on the no score side!!
@@vectorhacker-r2 ummm.... You need to watch George's video how he BECAME a millionare. He's not biased at all. Even if you don't invest heavily, being debt free is always going to make humans feel better than carrying around a lofty loan with a high credit score.
@@GeorgeKamel Not brainwashed. I understand that there is a difference between expenses and debt - but you don't. I use a CC, therefore I have a credit score. I pay it off every month, thanking the bank in Delaware that loaned me money interest free for ~40 days. My CC is an expense, just like my utilities and taxes are, I respect Ramsey, but he leaves no room for those of us responsible consumers who shun debt, but also use the system to our advantage.
Missed opportunity to rope in Cotton-Eyed Joe.
Recently paid off one of my student loans & credit score went DOWN 10 pts - I see their game.
Yup, its stupid. Since you paid off the loan, that means the "account" is closed. So your "total credit limit" (including home loans, auto loans, and credit card limits) lowered. And that affects your score. And since its a recently closed account, it also affects your score.
The Credit bankers won't have debt so they won't have a credit score even though they tell us we need to keep on having debt to have a credit score! It is a way of keeping people indebted whilst the bankers grow rich at our expense.
Going to add another point from my perspective. I grew up on Dave Ramsey and was convinced that the credit score was not required for anything. I successfully rented cards, and was able to rent with no score. But then several years ago I got slapped into reality when I was moving and found that no place in the new city would rent to me because my credit score was indeterminate. I ended up finding a place that would rent to me but they required a double deposit, were in a worse location, and cost more per month than some of the other places I had been looking at.
TL:DR; having a good credit score gives you options, and in my case the opportunity cost of not having it was incredibly high. Plus, to get a perfect credit score is incredibly simple and doesn't require ever paying a dime in interest. Just get a credit card with a low limit, put an expense that you are not going to overpay for on it (like gas), and pay it off in full every month. Within a year you'll have a score > 740 which is considered a perfect score for all purposes.
Anyway, just beware of this, especially if you are young or still renting. I love Dave, but this is an area where he is just plain wrong on the practical side of things. I would love a world where you don't need a credit score to rent. But unfortunately that's not the world we currently live in.
Exactly. It is 100% possible to live without a credit score but you're going to have to compromise. is the trade off worth it? I don't know.
Yes, the cities are where the credit score thing really affects you for renting. My first apartment was in a rural area. Month to month, handshake from landlord. My second apartment before I bought a house ran a credit check and everywhere in this area nearer the city does it that way. It's also a bloodbath to get an apartment, so having no score really reduces someone's chances of getting decent housing.
🎯
To a point… I’d love to see how you work around getting renting an apartment and also deal with employers or utilities companies looking at your credit score.
In my experience most apartments and utility companies will just want a slightly higher deposit and employers have never looked at my credit score(I don't know why they would?). It's mildly inconvenient but if you're good with your money it doesn't really matter.
If you are in a finance based role they absolutely look at score and history
@@tduck828 If you're in a finance based role you need a MUCH better job.
@@tduck828they look at your credit history and in almost all cases besides certain finance jobs they don't look at score. I worked in hr
@@tkat911 For sure. The place I’m renting now and the last place I rented didn’t care that I don’t have a credit score once I told them why I don’t.
I'm a simple man. I see a George Kamel video, I click play! ❤❤❤
I just want to see a video of you renting a camel with a debit card
Frampton Comes Alive 👍
utility companies require a large deposit if you don’t have credit
insurance companies require automatic ACH and a larger down payment
credit score is still important without loans
All hail almighty FICO! Lol. Totally kidding of course. I'm debt free and always will be! Love your content Goerge. If you are ever in kansas, we will treat you to lunch. The Ramsey show has changed my life!
Why don’t we create something to counter credit scores……like a money score?! 😮
These videos are hilarious
I have a credit score well over 800. I use a cash back credit card for all purchases. I have paid $0 in interest and fees in 40 years. I have no real debt, and am a multimillionaire many times over. You don't need to be "in debt" to have an extremely high credit score.
Credit scores just have sooo many errors. And you are not the customer but the product. My husband and his brother get their credit reports mixed because of their similar name and social security numbers! And for us to buy a house and for them to buy one… we had to send 3 separate letters to outline which brother had what.
At one point it looked like my husband has 6 cars! That was ridiculous. And they keep mixing it to this day.
Thank you George! The world needs to hear this! Invest in the stock market is way better than getting a credit score! Manage wealth not manage debt
You don’t need debt to have a good credit score.
@@Ivy-wv4wd explain?
@@jasondima1411 you can get a credit card and pay it off in full every month before interest. You don’t need to carry a balance. You can now add rental payments and utilities to your credit report via Experian boost and other similar services. Having a credit score will make your life easier. They check your credit for apartment rentals, utilities, phone services, jobs especially in the financial industry, etc. If you don’t have a score, you automatically get denied because it’s all automated now.
@@jasondima1411 btw I am not advocating for the credit scores. I agree with George that the system sucks but you have to deal with it because it’s the system that we have.
@@Ivy-wv4wdthat is just false. I have had a high score and no score and my life hasn't been harder in fact it's easier with no score because I have less monthly bills and more money. I have bought a house,gotvutilities have insurance with no score. My insurance is cheaper now that I have no score then my old 800 score.
You need a credit card to rent a car without troubles. You cannot rent a car in Knoxville TN airport without a credit card.
Ugh, Christopher!
My credit score is over 800 and I have effectively zero debt. I use a credit card occasionally (very rarely, usually for gas at Costco) and pay it off promptly. I haven’t been charged interest on my purchase for so long I lost count. But I prefer to avoid credit. It’s a pain when I have to make a payment that is from more than one line item in my budget. Our home is paid for. So now it’s just a high score. I don’t know if I want it to go away or not… but either way, it’s not my love of debt score!
Exactly! I don’t know why the Ramsey team keeps insisting this. My husband and I both have a very high score as well as my dad, and we’re far from broke. My dad is a multi millionaire.
@@libbyneefe1075 Because he is talking about the majority. A few people can manage to use a credit card well. Most can’t. A few people can leverage debt to become wealthy. Most can’t. He’s speaking to the majority.
Bruh you earn my like and sub everytime, hilarious and effective video!
I had no score or a low score depending on who you asked because I only had a student loan that was paid off within a month of graduating, and some apartment rental history. Getting a mortgage was a pain (only my local credit union with access to my detailed financial history were willing) and the interest rate I had was worse than it should have been.
I didn't and don't care about credit scores, especially with my house paid off and with no intention of ever borrowing again, but it's obviously better to have a strong credit score when it's time to borrow for a house. Lower interest rates are better than higher interest rates, and you get those with a strong credit score, for better or worse.
For me, I only had a paid off $20k car loan for history and one open credit card I sternly treat as a debit. Plus over 7 years of employment at one place with consistent raises. Getting my mortgage last year at 23 was insanely challenging even though those two things gave me an 800 credit score no matter who you asked. Even my credit union I got the auto loan through and had all of my financial history wouldn't even consider me. I had a %50 down payment to top things off. I finally found a lender that had a good interest rate (rates were rising fast) and would pre-approve me. They made it clear, in writing, that the only reason I was approved was because of my score. I'm no credit advocate as I prefer saving and avoiding payments, but I'm %100 confident I wouldn't have gotten my home at my age without that score. I'll be keeping my score in tip top shape until I don't need a mortgage to purchase a home/land as that's all I really need it for.
It's because you got your car before getting a house...don't ask me why that matters but if you're paying on a car note, some lenders think that if it came down to paying your mortgage or your car, you would pick your car so that's considered riskier to them than if you already paid off your car.
Also 50% down payments aren't what banks prefer. They want to be able to keep you in a loan longer because they only make their money off interest payments. I always say that even if you have 50% down...only put 20% and then after you make your first mortgage payment, make another payment right after with the rest of the 30% you didn't put down and apply it to the principal. You get the same results with more than likely a lower interest rate.
Lenders practically want people who cannot afford the home to get a mortgage. They don't like people who can pay the house of quickly...they want to make money.
@@caden01691
@soulanstreets Car was paid off for like three years before ever applying for a mortgage. You're %100 correct about them not wanting someone to pay it off quick so they can milk the interest. My credit union said they wouldn't approve me for said mortgage because I only had one open account. (Credit card) They wanted me to have at least two accounts open to "Prove I can manage multiple accounts" but we all know it's just because people are less likely to pay a loan off quickly if they have other payments to make.
That subtle reference to “cotton-eyed joe” (F-I-C-O) was amazing.
Glad I wasn't only one that caught that!😁
Both having a high credit score and having NO credit score would both be important to me as it shows how responsible a person is with money.
Correct. Having any credit score proves people are irresponsible.
@@amireallythatgrumpy6508 They are also impatient. they don't want to wait and save for what they want. Got to have it now! lol
Congrats on the 50K subs!
I've never ran into any ACTUAL problems with not having a credit score. Yes it's SLIGHTLY inconvenient when getting a rental car or APT, but we've made it work. I'd rather deal with the slight inconveniences than be tempted with with a credit card. I'm a HUGE spender, so I don't trust myself with a credit card honestly. It's so easy to just not have the line of credit.
Did you have credit and then no credit later? I have a few questions if you don’t mind.
@@DaRKWizaRdGaming0my wife and I stopped borrowing money and closed all our credit cards in 2020. It was the best thing we ever did. It really helped us control our money instead of wondering where it went.
Someone tag graham stephen !
Fight the power and speak the truth, G-dawg
I’m 50 years old never ever got a credit card never will and I turned out fine geez 🙄 I remember when the credit card companies took off I swear I had at least ten of them calling me every single day finally I couldn’t take it anymore and I went off on them I basically threatened them they didn’t like that I got a call from a office manager from the one I threatened told me I can’t threaten them I told them than stop calling me because I DO NOT WANT ANY CREDIT CARDS ENOUGH ALREADY he said you’ll never hear from us again and I never did 😁
I applied for my first credit card last summer to establish a credit score. I got approved for a $1200 limit a month later (so that line of credit is currently open) but I never activated the card. I signed up for monthly FICO reports 2 years ago. However, I didn't start seeing anything on my FICO reports till January of this year where it started me out at 725. Now as of July, it's at 742. My debt hasn't changed, my bills haven't changed. Just my job and my savings. Confused how it could continue rising like this.
By having an account and having it open over time, it might factor into the “length of account” portion of your score.
Your score is likely going up because your account is aging. Which is a "good thing"
I always thought I’d was stupid the only thing I ever needed debt was 4 a house. What interest do get then?
I have a credit card and think it is important for these reasons:
1. I get the highly cherished cash back
2. I get opening bonuses for new cards
3. Having a good credit score doesn't mean I am good with debt or money. I will give you that. But I think having a low credit score means you are bad with money.
4. At 4:50ish I didn't know that was how it was. I pay off my cards early before each statement and keep my utilization near 0%. Personally I thought that meant it had no effect on my credit score/was a good thing for it.
Same here I get 6% cash back for grocery stores, and streaming services. And got my bonus just for buying I would have bought anyways
IDK George I'm going to have to strongly disagree with you on this one! It's been statistically proven that ladies actually like the Tinder fish pics😂
I have no credit. Its my data and I want paid for it. If I want something I save for it. Credit+debt=debt slave. Debt free. Bought tax sale houses.
Im always “Feeling Knotty” when I tell my friends I don’t care about my credit score. Love your humour and videos George 😂
If you have a mortgage, how do you not have a credit score?
I paid off the mortgage. I have a high credit score but it has dropped since the payoff.
Jesus christopher what did you do to george
He knows good and well what he did. Good and well.
The fish is symbolizing that you’re about to be catfished
How long does it take for my score to go away after removing the debt and credit cards
Great Video! And A Great Reminder! Thank You George! God Bless You, your team and all at Ramsey solutions!
I dumped $8k into my mortgage principle (24k to 16K) and the credit people didn't like that apparently and dropped my score by 16 points.
How dare I try to pay off my mortgage, how dare I.
When moving to the US it was a big issue for me to rent a good house, because I didn't have any credit score. Some of the renters wanted up to 6 months up front payment, some just plainly didn't want to rent.
They're renters you want to avoid anyway. You just know it would take a month to do an urgent repair
I am debt free. My credit score has dropped. Not much. How do I get the credit score to zero? I have never closed any old credit cards. They eventually close them for me. Love your help!
You must close all accounts to start the clock on the score becoming indeterminable. Don’t wait on someone to close them. 6-12 months after that, your score will become indeterminable
It is time for me to run my annual credit report. Is that the best way to figure out what accounts are still open? I have no idea which ones are still open. Thank you
I think accounts remain on your report for 10 years, so you'd have some sort of score for probably at least that long.
You'd have a credit report with information but the algorithms probably won't generate a score without any recent, active data
I have now closed all my accounts. My FICO score has dropped from 835 to 732. Will wait and see. Thank you
George, I do think there is some grey area where you can be responsible and budget effectively while using a credit card as a proxy between your purchases and your actual money, but I also agree that credit scores and credit card companies are dumb! great video!
Proxies are for wusses. Real men use debit!! 😎
@@GeorgeKamel hey man, I use my debit too!!
@@vectorhacker-r2debit cards have the same fraud protection as credit cards by law.
@@GeorgeKameluntil your debit card is hacked and someone has direct access to your bank account. Personally prefer the added security of the credit swipe
@@louisnvrr ooooh.... The FEEEEAR... Listen, prepping for the worst when the worst is not likely to come is a form of insanity.
If she ain't into fishin I ain't into her
2:07 I was born in 89 too!!
He can’t keep getting away with it
This is a serious question. I promise I'm not trolling. I'm not a home owner just yet, and I rent. I have watched videos about how to get a mortgage without a credit act, but how do you get approved to rent an apartment without a credit score? Does anyone know of a particular form that can be applied to this situation, or maybe sending a letter to your prospective landlord explaining that you are debt free will do? I'm just curious if anyone has experienced this.
They check for bad/low credit. No credit is far less of an issue. Sometimes there may be a higher deposit or first and last months rent, but that’s it.
@@GeorgeKamel Thank you so much. I really appreciate you taking the time to respond.
Why would you want to rent an apartment? They're not fit for human habitation.
Can you give more information about car insurance w/o a credit score?
Here’s a link for you! www.ramseysolutions.com/insurance/independent-insurance-agent
I mean, if you’re responsible.. having a good credit score makes things easier. Good luck going a no credit score mortgage and getting beat by someone who finishes the process faster.
true
The only problem is having a credit score is essentially necesssary if you plan to move. You're not getting a mortgage without one and so many landlords run credit checks now.
The concept of credit scores is absurd. That's why better countries than the US don't have them
George is dat dude
While you mention insurance, you kind of gloss over it and you make a few miss statements. Your credit score will severely impact your insurance cost and your ability to be bonded. While it is possible to get around most bonding requirements by putting up the cash equivalent, it is not always feasible. Someone with good credit can pay up to half compared to someone with no credit and even more savings compared against someone with bad credit.
Also, you can obtain and maintain an 800+ credit score and not be in any debt whatsoever and not pay a penny in interest or finance charges of any kind. To imply you have to be in debt to get or maintain a high credit score is just wrong. I have no debt of any kind and I have a 800+ credit score. While I do have credit cards, I never carry a balance and I never pay interest. I fully understand the argument that people with a credit card have a tendency to spend more, but that can be overcome by creating and sticking to a budget.
I am not trying to convince you to use credit cards or anyone else, I just want to see more accurate statements in regards to a credit score.
Truth! I have zero debt and my score is way over 800. It does make things much easier.
Many employers check credit scores of applicants. Positions that require a clearance heavily utilizes the credit score for background checks
They’re checking for bad credit. I have not heard any stories of someone with no credit having an issue getting a job
My spouse has one of those fancy dancy clearances. Didn't need a credit score for it. Not having debt also makes the SF-86 paperwork a breeze. Nothing to hide and nothing to worry about.
@@punkbassandcovers thank you so much for busting this myth
@@GeorgeKamel You got it. Keep up the great videos!
I will say that the one pain point with the clearance paperwork is that the employer does make us report every retirement related financial transaction outside my wife's employer retirement accounts. I believe this is because of the potential conflict of interest between employer and government. They need to know what we are invested in...so for example every time our Smartvestor Pro makes a transaction with our Roth IRAs it has to be run against a list of what the company does/doesn't allow us to be invested in.
George I've had very high finance positions in the past and they check score and history YEARLY. If you didn't hit certain parameters you no longer were employed. It can and does happen. Just because you don't think it does, absolutely does not make it not true..