Quote:
Originally Posted by venturaII
Depending on where you're trying to rent, not having a credit rating (let alone a bad one...) could absolutely mean the difference between getting in or not. But the reason it's such a big deal with cars is that, next to buying a house or sending a kid to college (both done through obtaining loans, btw...lol), buying a new car is just about the largest single purchase a person will make. And not many people have $30+K sitting around as liquid. Sure, you can skip the bank loan and ask the dealership for a loan, but with no credit or bad credit, you're a huge risk, so you'll be paying ridiculous interest rates, whereas a loan through a bank or dealership with excellent credit and associated low rate can actually be a smart move. There's always low single digit financing programs available through manufacturers or banks...you won't pay much in interest, and your credit goes up in the process. They key is to not spread it out across a long term.
I have a good friend who is now in his mid 60s who, for the first 50 years of his life, never even had a checking account. His paycheck went in the bank, and he payed his bills in person, in cash. Never had any debt. But even he had to give up on that lifestyle. Try doing that today....it's a total pain in the ass, at best. Lots of utilities and government agencies like RMV won't even accept cash payments in person any more..!! How's that for some irony...the government won't accept it's own currency...
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Off topic: If people lived within their means loans and/or credit would be rarely ever used. Debt causes stress and depression more than it does any good. Sure people don't have 30k sitting around to buy a car or 200k to buy a house, and most people don't need a 30k car or a 200k house either.
Loans can be beneficial when used responsibly, sadly most Americans don't know how to be financially responsible. Eliminating personal debt should be everyone's goal, but that would require not getting the newest everything all the time...
As far as college, 2 things; 1. College is not a requirement for everyone. 2. Going to college does not require loans.
Says the guy who has 2 debts, 1 car & 1 house. Both will be paid off long before their full loan term, and has a college aged daughter that has no debt, is in her last year off college and preparing to go for her graduate degree. And no, I didn't fund it for her.