No Credit Question

[Throwin Darts]

There isn't other than not using credit for 10 years. I paid everything off before I got married in 07 and bought a house with no debt. Canceled 3 cards and didn't use or apply for credit until last year to finance my wife's SUV. Didn't like the rate so we paid cash. Got a card for rewards where I can monitor my score and it did what I said.

There’s your answer right there. You cancelled three cards and lost that credit history. Less history, lower score.


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[Tex_Cattleman]

My wife and I are in our late 20s and looking to buy a house or land an build soon.

I have really good credit but my wife has zero credit history to her name.

I have very little debt to my name. Just some Farm equipment that was 0% interest so why not use there money.

Question is what Credit Card is the best option for her to build credit.

I hate having to pay high interest rates on money that we dont need just to build her credit. But i am told that you dont need to pay the card off every month.

There is thousands of credit cards out there so school me on the best route.

Thanks for all the help!

I work with credit/FICO scores every day. Many myths out there, as evidenced by the advice above. I welcome a call or email (512-203-5869 or trey@treypowers.com) and will give you all time you need to explain how to get where you want to be.

I'm a contributing columnist for a local publication and recently wrote on this very topic. See below:

Credit Scores - Your Financial Report Card

Think back to your school days and 6-week report card. The purpose was to quantify, for you and your parents, your academic performance for that period. The scores on your credit report are just the same. But rather than getting money for A’s and being grounded for F’s, credit scores are used by lenders to determine whether you qualify for a loan, and if so, at what interest rate. While this is general knowledge to most adults, the details on how a credit bureau arrives at their score is mostly a mystery.

Scores are generated by algorithms unique to each bureau (Equifax, Experian and TransUnion) using information from your credit reports and summarizing your borrowing history. You should have three scores, one from each of the credit bureaus. Mortgage scores range from 300 to 850 and are made up of components including payment history, current debts, length of credit, types of credit and new credit. I’ll touch on those and provide tips for each.

Payment History is very simple, Friends. Pay your bills and pay them on time! This accounts for 35% of your score.

Current Debt relates to how much you owe and whether you are maxed out. It accounts for 30% of the score. This is most important for credit cards. Use that available credit to build the score, but do not charge too much. Using over 30% of your available credit limit will hurt you. Using a low percentage and paying it each month will help you.

Length of Credit accounts for 15%. If you have used a particular card for years and trade for one with better rewards, rather than close the old one, keep it open and use it here and there.

Types of Credit accounts for 10%. Do you have a healthy mix of different types of debt? The bureaus like to see you utilizing different types of credit (credit cards, auto loan, mortgage, etc). New Credit accounts for 10%. Each time a creditor “pulls your credit” you take a slight hit on your score.

Finally, like extra credit to build your school grade, take the time to research this topic further. Every point counts!

Trey Powers is a licensed mortgage loan officer with City Bank Mortgage, a Texas-owned lender. He was voted 2017, 2018 and 2019 Best Mortgage Lender in Dripping Springs. Trey lives, works and volunteers right here in DS. Contact: 512-203-5869 & trey@treypowers.com. Visit TreyPowers.com

[Sleepy]

Don’t put her on the loan? That’s what I’d do anyway.