Just went through a mess trying to finance a used car. I haven’t borrowed money since 2012, no debt, no credit cards, just living within my means. When I applied for a loan, I was told I was refused. Not because of bad credit, but because I hadn’t used credit recently enough.
The dealership advertises “no applications refused,” but apparently if you don’t have an active debt history, you’re too much of a mystery for the system.
Co-signer? Not allowed. Using my own bank account for payments? Denied. Their solution? Open a joint account with my dad just to satisfy a bank’s paperwork, pay hundreds in fees over 6 years just to make it work.
The credit system says you can’t borrow money unless you’ve already been borrowing money, like somehow living within your means disqualifies you. It’s not about good credit, it’s about loyalty to the debt game. Screw you for standing on your own feet, I guess.
Just needed to get that off my chest. Anyone else run into this nonsense?
Last I checked, you don’t even need to use the credit cards, you just need to have them. IIRC, they only ding you for late payments and for having high balances.
They need to be “active”, and “paid as agreed”, which doesn’t mean a whole lot. You are perfectly fine to get a pack of gum each month, and pay the balance in full. Or put a monthly bill on your CC, or just use it for gas. Just so there’s activity each month.
Obviously avoid any that have a fee, and pay it in full each month.
It depends on the card. Most will drop you if you don’t use it at all for a year or two.
True. It’s easy to set up one recurring payment, for media streaming or whatever, and otherwise leave it be.
I did this when I turned 18 and it’s been super useful (one of the few areas that my mom was a role model for me was that she had excellent credit, despite being poor as shit).
This just underscores OP’s general point for me though. Beyond the car dealership stuff, I have heard of plenty of examples in which having no credit history was worse than having bad history. It’s one of those things that I think does make sense, in the wider picture, but is also pretty fucked up.