6 ms·

To make it worse, no credit history equals a score of zero, so it can be worse than just having bad credit.

conanbatt 7y ago
Depends on the use-case. All foreigners that migrate for a job to the us have no credit history, and no significant problems finding apartments and opening bank accounts.
- deleted 7y ago
  [deleted]
- totaldude87 7y ago
  And has to pay hefty security deposits, each time when they switch (without a proper credit score)
  - conanbatt 7y ago
    Might depend on where but I've had no different treatment from my no-score days to my now healthy score.
- Cyph0n 7y ago
  > and no significant problems finding apartments and opening bank accounts Firstly, opening a bank account almost never requires a credit check. Think about it: what risk is the bank taking on by giving you an account with nothing in it? Secondly, renting an apartment typically involves a credit check in my experience. I had my father co-sign my first lease to avoid the security deposit (~$1000, 1 month of rent). There is also a separate renter's score (?) that evaluates how "good" of a renter you are in general.
  - brianwawok 7y ago
    Bounced checks, or overstrung debit cards. I think no history you are fine to open a bank. But I think if you have bad credit history (like previously bounced checks), you won't get approval for a checking account - or get a very limited account.
theandrewbailey 7y ago
Even worse: paying off all your loans and having no credit cards is zero. It made getting a credit card more difficult. The lady at the credit union couldn't get the system to auto-approve me for any credit limit because of it. > Around here, we like to say a credit score is just an “I love debt score.” Think about it. A credit score doesn’t reflect your salary increases, the amount of money in your savings account, or how well you budget each month. > If someone in your family was to pass away and leave you a million dollars, your credit score wouldn’t change one single point. Your net worth would skyrocket, but your credit score wouldn’t budge. Seems fishy, doesn’t it? > In other words, a credit score has nothing to do with how well you handle your money. But it does show how well you play around with debt. Your credit score is solely built on how much debt you have, what kind of debt you have, how long you’ve had it, and how you’ve paid on it. https://www.daveramsey.com/blog/what-is-a-fico-score https://www.daveramsey.com/blog/what-is-a-fico-score
- TulliusCicero 7y ago
  If you just treat your credit cards like debit cards, you can easily build a better credit score without really being 'in debt' or paying any interest. And in the US at least, there are also some other benefits, like better fraud protection and purchase/sign-ups bonuses.
  - 4ad 7y ago
    Not if you can't get credit cards at all (because of zero credit rating).
    - astura 7y ago
      You just have to get a shitty secured card for a few months. This Amazon card is an example of a secured card.
      - asdff 7y ago
        Those require some cash that might not be so easy to free up for some people. When I was building my credit I had to put up $300 for my bank's secured card, and couldn't get that back until I fully closed that account which was reflected on my credit score of course (my bank did not transition secured cards to 'real' cards like some do). Most middle class and up people don't have to do this song and dance. Parents can add you as an authorized user on one of their cards, and you could build up a great score and a fat credit limit just in time for you to max it out during spring break in college.
totaldude87 7y ago
I think its easier to build a credit score from "no credit history" than recovering from a bad credit.. so :" no credit history" > "bad credit" in long term

Depends on the use-case. All foreigners that migrate for a job to the us have no credit history, and no significant problems finding apartments and opening bank accounts.

deleted 7y ago
[deleted]
totaldude87 7y ago
And has to pay hefty security deposits, each time when they switch (without a proper credit score)
- conanbatt 7y ago
  Might depend on where but I've had no different treatment from my no-score days to my now healthy score.
Cyph0n 7y ago
> and no significant problems finding apartments and opening bank accounts Firstly, opening a bank account almost never requires a credit check. Think about it: what risk is the bank taking on by giving you an account with nothing in it? Secondly, renting an apartment typically involves a credit check in my experience. I had my father co-sign my first lease to avoid the security deposit (~$1000, 1 month of rent). There is also a separate renter's score (?) that evaluates how "good" of a renter you are in general.
- brianwawok 7y ago
  Bounced checks, or overstrung debit cards. I think no history you are fine to open a bank. But I think if you have bad credit history (like previously bounced checks), you won't get approval for a checking account - or get a very limited account.

theandrewbailey 7y ago

Even worse: paying off all your loans and having no credit cards is zero. It made getting a credit card more difficult. The lady at the credit union couldn't get the system to auto-approve me for any credit limit because of it. > Around here, we like to say a credit score is just an “I love debt score.” Think about it. A credit score doesn’t reflect your salary increases, the amount of money in your savings account, or how well you budget each month. > If someone in your family was to pass away and leave you a million dollars, your credit score wouldn’t change one single point. Your net worth would skyrocket, but your credit score wouldn’t budge. Seems fishy, doesn’t it? > In other words, a credit score has nothing to do with how well you handle your money. But it does show how well you play around with debt. Your credit score is solely built on how much debt you have, what kind of debt you have, how long you’ve had it, and how you’ve paid on it. https://www.daveramsey.com/blog/what-is-a-fico-score https://www.daveramsey.com/blog/what-is-a-fico-score

TulliusCicero 7y ago
If you just treat your credit cards like debit cards, you can easily build a better credit score without really being 'in debt' or paying any interest. And in the US at least, there are also some other benefits, like better fraud protection and purchase/sign-ups bonuses.
- 4ad 7y ago
  Not if you can't get credit cards at all (because of zero credit rating).
  - astura 7y ago
    You just have to get a shitty secured card for a few months. This Amazon card is an example of a secured card.
    - asdff 7y ago
      Those require some cash that might not be so easy to free up for some people. When I was building my credit I had to put up $300 for my bank's secured card, and couldn't get that back until I fully closed that account which was reflected on my credit score of course (my bank did not transition secured cards to 'real' cards like some do). Most middle class and up people don't have to do this song and dance. Parents can add you as an authorized user on one of their cards, and you could build up a great score and a fat credit limit just in time for you to max it out during spring break in college.

totaldude87 7y ago

I think its easier to build a credit score from "no credit history" than recovering from a bad credit.. so :" no credit history" > "bad credit" in long term