Best Way to Build Credit?

Off Topic
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[quote]rainjack wrote:
orion wrote:
rainjack wrote:
orion wrote:
Have assets.

Instant credit builder.

It would require you to actually save and buy them though and that hurts of course.

Not that I would invest in the US right now.

You could by Canadian stocks though. Preferably companies producing commodities.

Yup, save and own stuff. Boring, I know.

Why would one not invest in the US? If there has ever been a great buy opportunity, it would be now.

Buy low - sell high.

But I agree with your approach.

I remember several months back, there was a discussion similar to this about how people were using credit to invest in real estate. I wonder how smart they feel today.

I expect the dollar to fall. It would make sense to be in another currency then.

The dollar is falling. That’s why the US would be a good investment. It will come back. This is just a cyclical thing. Happens every 20 years or so.

[/quote]

Really? Twenty years ago the dollar was worth more than twice than what it is worth today and now you have foreigners
holding trillions (!!) of short term (!!!) debt.

If they decide to to go elsewhere with their money, which would be a wise decision, all those dollars flood back into the US.

In my lifetime I have only seen the dollar lose value, when has it ever significantly gone up?

63

You don’t recall the 70’s or the 80’s? We had double digit inflation, the dollar was crap, and farmers were making a killing.

Then the dollar came back, inflation went down, and the farmers rturned to losing their asses.

It’s cyclical. Last time around it was the Saudi’s and the Japanese everyone was pissed at for buying up stuff in the US. Now it’s the Chinese.

That’s the way it goes in a global economy.

64

Wow. This is kind of interesting. Credit must be very different in the States vs Canada. Half of the advice given wouldn’t mean anything here as far as building your credit.

65

The three things I can think of off the top of my head that are relevant are

  1. Pay your bill on time.
  2. Owe less than your credit limit (like 50%).
  3. Pay your bill on time.

The main thing credit card companies really care about is that you pay your bill on time.

FICO score also includes factors like time at one address, time holding credit, holding a mortgage, etc. Obviously those take time to build. But using credit and paying on time is the biggest factor in the formula.

Usually if you pay your bill on time for awhile, then ask for a credit increase, you will get it. But right now lenders are extremely skittish because defaults have skyrocketed, so they are tightening their lending. But normally, they’re willing to extend you enough credit to ruin you.

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[quote]andersons wrote:

FICO score also includes factors like time at one address, time holding credit, holding a mortgage, etc. Obviously those take time to build. But using credit and paying on time is the biggest factor in the formula.
[/quote]

I’m pretty sure FICO scores only consist of 3 things.

Payments on time
Ratio of credit you have available (it’s better to owe $3,000 out of $10,000, than it is to owe $1000 out of $2000.) The first gives you a credit ratio (wrong term I know) of 30%, where the latter is 50%.
And finally your length of credit history