What's your credit card and why is it best for you?

[Kasz216]

Shinobi-san said:

Kasz216 said:

the2real4mafol said:

Kasz216 said:

I don't understand that at all. Why can't they just use my bank account/ debit card history to determine if i can a mortgage/ loan?

Not like it matters, there is no way i could afford to own a house in London anyway. Most people can't, anymore. Damn housing bubbles!  

Because a debit card is just a plastic check.  Checking accounts aren't reported to credit score companies.

Largely because well... they aren't credit.

The money disapears right away so you never build up debt.

 

Banks don't want to see if your responsible enough to not spend yourself into more debt.

They want to see if you are responsible enough to not spend now, when you have to pay off debt later.

 

Think of it this way.  If you have $5 in your pocket.  It's easy to spend 3-4 dollars on food and not go over or in debt.

If you owe someone $5 it's a lot harder to hold on to that money.  A lot more tempting to spend it.

 

I guess living in England you can go without a car... but quite honestly, it's worth building up a credit rating, you never know when you'll find yourself wanting to buy a house, a car, start up a buisness, etc.

I think its worth pointing out to the2real4mafol that you dont need a credit card to build up a good credit rating...there are multiple other ways to go about it.

I mean, while that's true.  They all cost money and require you to do things that rip you off.  Like rent furniture instead of buying it for example.

 

Getting a credit card with say... a $500 dollar limit and using it exactly like you would a debit card is just the best way to do it.