A Question to Ponder

[ksgirl38]

Regarding the issue of building credit;

Presume you have made the decision to never use credit again. No credit cards, no car loans, no mortgage, no 90 day same-as-cash purchases, NADA.

In your opinion, is it still important to check your credit reports? Is it still important to 'build' a good FICO score? Why or why not?

I'm interested in anyone's perspective on this regardless of whether you choose to use credit again or have sworn it off completely.

The only reason I would think you'd want to check your credit report would be for identity theft. If you are not using credit, then I'm sure you don't care what your score is. Although personally I see that as a mistake, but that's just my opinion.

[Pandora]

we do check our credit reports annually, but only for fraud. Havent used a credit card since 2008 - havent financed anything since early 2009 (one car), and will never finance anything again. Everyone asks us all the time "how do you not have credit cards? What do you do when things come up like car repair or house repairs?" Just as they find it strange and mystifying that we dont use credit for repairs, we find it strange and mystifying that they do for those things.

Every person is different; I know people that have many credit cards, use them, pay them off every month and never carry a balance - and others ... WHOO WHEE buddy! They remind me of the old debt commercial where the guy is smiling all the time, riding around on the zero turn, in front of the huge mansion yet saying "I'm in debt up to my eyeballs..."

[tobee43]

Personal Injury Protection, only required in some states, I think 17 or so, CA is not one of them to the best of my knowledge.

Pj, try nj manufactures. i remember our car with top coverage was apprxo $650 BUT they give you a percentage back for being good when we had four cars on the policy we always got about a $900 check around xmas time. (we also used them for homeowners).

in nj you can have choices like pip and or the forgoing your right to sue. " the automobile insurance cost reduction act" in nj mandated that a basic policy be available to all drivers. that's why you heard all about the insurance companies hauling their butt right out of nj,
while in nj we paid that little we got here; florida and the same car was close to doubled!!! however we had to have pip and their was NOT a choice about whether we wanted to forgo the right to sue or have the pip it was mandatory.

[TBA]

I think everyone sees and uses credit in different ways - my sister has a problem... my mom has bailed her out on more than one occasion. She does live outside her means. When i look at the way she uses credit, i shake my head. She wants a tv, she finances it. she wants a new sofa, she finances it. any big purchases she just goes out and buys on credit without really thinking. I think she abuses credit. if she wants a new tv, she should save for it. if she wants a new sofa, she should save for it. That is what i do, and it works for me. I did this even before bk (my bk was mostly business debt) and i continue to do it now.

That being said, i will finance a car (I reaffirmed the one i have), i will finance a home purchase (stay and pay), and i will use credit to pay for my monthly expenses that i pay off every month. I keep a nice little stash in a savings account, and a bit more cash in a safe.

I wont swear off credit. but i wont ever finance a tv.

[TheBajan]

It was not my intention when starting this thread to cause or create judgments regarding whether or not using credit is good, bad, stupid, smart, moral, or immoral. I don't think any of us here woke up one day and decided to purposely plan to go bankrupt. In our case, there were many factors outside of our control that played a part in where we are now. Yet, I still know, understand, and accept the role that I personally played in getting us here.

By saying that I've made the decision not to borrow money again in no way means that I think no one should. I don't even consider myself irresponsible with credit. On the contrary, we used credit for 20 years and until the last 3 years prior to our filing, we always paid them off at the end of the month. My decision is not based on a lack of confidence in my own discipline. Rather, it's based on the fact that I'm simply more comfortable without credit that I ever was with it.

Before I had credit, I was very good at saving money. I was very good at making a little go a long way. I saw more clearly what was important. I understood better the difference between needs and wants and I 'wanted' less. Once we started using credit cards, financing automobiles, etc, we stopped saving. We had investments and IRA's and the like but nothing for the everyday emergencies that life throws at you. Since we've been in BK, I've become passionate about saving. It's almost a game to see how much we can save rather than how much we can spend.

For me, this is the right decision. I can only speak for me. No judgement. Just wondered about everyone's take on the idea of credit monitoring and credit building.

[AngelinaCat]

It's interesting how things happen in everyone's lives, and how we get where we end up. In my case, I grew up in a paid-for-house. So the concept of having a home mortgage freaked me out a bit. Also when I went off to college--and my first time from home, my mother and I got me a beginner's MasterCard with a $300.00 limit. That was fine with me, and I never requested to have the limit increased.

I should add that there were no college loans either. Some property that the family sold paid for that.

When my husband and I got married, he couldn't believe the $300.00 limit. That quickly moved up to $1000.00 and then from there eventually up to $36K on one card and 6K on another.

We lived well beyond our means, though we were able to plan our estate, where the home got paid for, so I was and am back in a paid-for-house--though we are in the middle of renovations.

So after BK, we are back where I was in college, with almost no loans, and we budget and save for things.