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I don't have bad credit, I have NO credit!


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Hi Everyone!

I have a question ... I've heard that if you have NO credit, it's just as bad as having BAD credit! Is that true? I've never had credit cards because I dont believe in them ... I've paid for everything in cash. If I don't have the money for it now, I simply wait for my income tax return each year. I've never wanted for anything, so this lifestyle has worked for me just fine.

A few years ago, I married a man with $30,000 in CC debt (all are now charge offs due to unfortunate circumstances). We're still dealing with those issues.

I've read that I can help to increase his credit scores if I got credit, then piggy-backed him on my credit. I'd like to know if that's true. I'd like to know if I get credit, and piggy back him, does that put me at risk because he's currently in default. What if I just add him as an authorized user? Okay ... now here's the real sticker:

I'm a stay at home mom with no income. My hubby is the bread-winner. How do I apply for credit with no real income of my own? Do I use his income since we're married? Will anyone give me credit with no credit history? Who should I go to first?

Any help is greatly appreciated!

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Hi Everyone!

I have a question ... I've heard that if you have NO credit, it's just as bad as having BAD credit! Is that true?

Yes this is pretty much true. Most credit cards deal with some form of credit scoring so if you have no credit, well then there is nothing to score. On some occasions though, I have seen where it is a little easier for someone just establishing credit have an easier time getting it over someone with bad credit.

I've read that I can help to increase his credit scores if I got credit, then piggy-backed him on my credit. I'd like to know if that's true. I'd like to know if I get credit, and piggy back him, does that put me at risk because he's currently in default. What if I just add him as an authorized user?

It can, but the problem with it is that piggybacking is only going to be good for a couple more months then it's going away and he's right back where he started. If the COs occurred prior to your marriage then you can't be held accountable for them. You can add him as an authorized user so that you guys have the ability to use the available cards but he really won't get any benefit from it for very long.

What you two really need to do is sit down and somehow go through trying to get his credit reports in order. That is going to be your best bet. Even adding 1 or 2 isn't going to put a dent in what his scores or reports look like because it sounds like there is too much damage to it. You need to organize what is on his reports and make some plan of attack to clearing them up. If he got that out of hand with his own credit, I personally wouldn't trust putting him on any of your cards. If something should happen, you guys would at least have your credit to fall back on.

I'm a stay at home mom with no income. My hubby is the bread-winner. How do I apply for credit with no real income of my own? Do I use his income since we're married? Will anyone give me credit with no credit history? Who should I go to first?

Well, what does help is that a lot of applications lately ask for Household income instead of just employment income. In that case you can use what types of income from everyone in the household, side jobs, etc. That's how you can get around it even though you would still put down that you're a homemaker for employment.

If you're looking at building credit, I would recommend starting with a Secured Credit Card. The two out there that have been recommended so far are Bank of America and National City Bank. Basically you pay to them what you would like for your limit. So if you send in $500, that will be your limit. Then after 9-12 months, the cards will graduate and your deposit will be returned to you.

If you apply for BoA, there is a chance that you may get the $99/$500 card, their downside is 2 Experian pulls for the secured card. So with a $99 deposit you get a $500 limit card.

You can also apply for Crown Jewelers, they don't pull a report at all. The only downside with them is that you need to make a purchase with a small deposit before they report and they only report to 2 of the 3 CRAs.

You may also be eligible for a Cap1 card, they pull all 3 reports. Although you have no score, nothing on your reports, they will still pull and you will have inquiries listed.

I would just start out with a couple of cards to go slow and start working on getting his credit cleaned up. That, I see, is really the issue. If you haven't already, I'm sure you will be getting contacted by CAs and threats of lawsuits. I can't see CC companies turning their shoulder on $30k in debt. You really gotta work on that, in the end it could cause more damage by letting them go.

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If you are uncomfortable with having credit cards, then build up your credit with secured loans. You put money in a savings account and then borrow against it. These loans are guaranteed so the income issue won't be much problem. This way you don't have a card you are tempted to use.

1. Dont go to a bank to do this unless you cann do at least 5,000. The banks don't do these in small amounts. Go join a credit union for this.

2. You can do small amounts at a credit union, but I would suggest at least 1,000.00. It may help your score better than a 200 or 300 loan (though I'm not sure about this-I've just been told this).

3. Make sure that the credit union reports to all 3 agencies, not just one. Get the maximum effect of your loan.

4. Now, its best to put money in savings, borrow against it, then put the check they give you back into that savings account, or one somewhere else with higher interest. That way the interest you make helps make up for the interest you pay on the loan. But in some cases, you may not have the extra money to spare. If that's the case, here's what you do.

Lets say you have certain times of the month you pay your bills. You take the bill money a day or 2 before you pay those bills, go to the credit union, put that money into the savings account, then do your secured loan right away. They will give you a check for your loan which gives you back the money to pay your monthly bills on time. i did this the 1st time I did one of these. The great part is that when I paid off my loan, I had forced myself to save and had money in my savings account!! Also, with most credit unions, as you pay down, the balance in your savings account is available to you in case you need to withdraw it.

5. You can't piggyback these loans, so if you are trying to also build up your husbands credit, then you need to have the savings account and loan in both name.

6. Set the loan up for 18 months. That will give you an account with over a year history once you pay it off.

Hope this suggestion helps you somewhat. I built up my credit this way.

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I had actually done just what you described way back in the late 80's! I forgot about Credit Union signature loans as being an option. Thank you for reminding me. No, I don't think I would begin with getting a loan on an account that my hubby and I are both on. I have done everything I could to ensure that his credit won't affect mine (didn't take his last name when we married, no joint credit accounts, etc), and a loan with both of our names on it may just accomplish that.

I think that a loan from a credit union is probably the best way for me to go. Then, I might get a credit card from a jewelers ( I lost my wedding rings anyway) and I can piggy back him onto that card after 6 months or so.

Thank you!

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Your welcome. Also, a lot of credit unions offer secured credit cards as well as secured loans. You might want to get one through them then add him as an authorized user for piggybacking. however, with the scoring system changing in a few months, its probably not worth it to add him on. If he's trying to build up his credit, he can open up an account at the credit union also and do his own secured loan seperate from yours. That way, you are both building without him being on your stuff.

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