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Lack of debt might be good, but lack of credit history is bad. As an individual, even if you don't ever want to get into debt and pay for all your purchases up
by lionheart 17y ago
Lack of debt might be good, but lack of credit history is bad.
As an individual, even if you don't ever want to get into debt and pay for all your purchases up-front, you have to make an effort to build your credit history. If you don't have a good one a lot of things completely unrelated to debt become a lot harder in our society.
Same thing applies to companies. Possibly even more.
- ThomPete 17y agoThis of course assume that credit history is both good and the only way to do it. In Denmark it's the other way around. You don't get a credit history you get marked as a bad payer. In other words you are not forced to take on debt to show that you can pay your rent instead you are checked to see if you are a bad payer. I have lived in the US and had to build a credit history to rent a flat. I never understood why this is good for anyone but the banks.
- patio11 17y agoThom, you are collateral damage from a rational decision that an American with no history has something to hide. Their defaults are measurably stratospheric compared to folks with positive history. There are nondefault risks such as property damage or running a meth lab, which will cost the landlord five figures to clean if it does not raze the property. Apologies for the inconvenience.
- ThomPete 17y agoYou take the system that you know and assume that this is the only way to do it. I have just explained how it can also be done and is done and run perfectly well. Make of it as you want.
- dhh 17y agoThe only time our lack of credit history has hurt us at 37signals is when we were looking for some sort of credit, like net-30. In that instance, we changed to net-10 and things were fine. If you don't need credit, you don't need a credit score.