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post #16 of 20 (permalink) Old 01-25-2013, 07:54 AM Thread Starter
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Originally Posted by mordalphus View Post
just pay cash

credit card charge 20% interest, you wanna pay that on 800 dollars? haha..

That means even if you pay off the next month you owe extra 13 dollars. take 6 months to pay off and its extra 80 dollars, a year and it's 160 dollars... And that's assuming you are disciplined enough not to purchase anything else on the card in the meantime!

Always if there's a choice of credit over cash, take cash!
haha you have a point. Mine is 14%. But another credit card is no interest for a year. I can definitly pay it off in a year. Latley I have been trying to find ways to raise my current credit score. Right now its around 730. Thats why I thought of it that way.
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post #17 of 20 (permalink) Old 01-25-2013, 10:49 PM
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Yes, but an empty credit card is not good for credit, a new card is also not good for credit. And if you pay it off in a year, then close it, all the credit associated with it will disappear as well.

I hate credit cards, I only have one, which I'm sure to use and pay off each month. And with just one card, my credit score is 782, which isn't bad. The thing that raised my credit the most was my car payment and house payment. Things that haveinjured my credit the mmost was refinancing my house and not having enough potential debt. (ridiculous)

But at least you're someone responsible with credit, I only said cash before credit because so many people in the USA treat credit like free money
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post #18 of 20 (permalink) Old 01-27-2013, 05:08 AM Thread Starter
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Im confused..so closing a credit card will make it not count? Thats weird...
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post #19 of 20 (permalink) Old 01-28-2013, 09:27 PM
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Im confused..so closing a credit card will make it not count? Thats weird...
Yep, when you close a credit card it removes the credit history associated with that card. It even shows as a negative on your credit report as a loss of credit but only for a little bit.

I know, it's stupid, but it's like a game and unfortunately the credit card companies are the ones who make the rules.
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post #20 of 20 (permalink) Old 01-30-2013, 02:22 AM
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The benefit of having an open credit card with zero balance is that it helps you debt/credit ratio. So lets say you have 1 credit card with a $2000 limit, and have a $500 balance on it, then you're at a debt ratio of 25%. But if you have a second card with no balance on it, and another $2000 credit limit, your debt ratio is now only 12.5%

Usually anything over 16% debt ratio is considered to be too high by credit card companies, so sometimes it IS beneficial to open another card if you expect that you'll be making a large purchase that you'll be paying off over a long period of time. Hard to know which would hurt worse, the credit inquiry, or the very high debt ratio. Probably depends just how high the debt ratio would be.

-Scott
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