Is it possible to have a great credit score with loans only?
Filed in Credit on Oct.06, 2009
Lynn asked:
Is it possible to have a great credit score with loans only and no credit cards? I have bank loans for cars and personal loans but due to my inability to control spending on credit cards I don’t use them anymore. In fact, I am afraid of them…..Is not the choice to not use them good credit management?
Is it possible to have a great credit score with loans only and no credit cards? I have bank loans for cars and personal loans but due to my inability to control spending on credit cards I don’t use them anymore. In fact, I am afraid of them…..Is not the choice to not use them good credit management?
Thank you, in advance, for your time and knowledge!
To Clarify:
I want my credit score to be no lower than the middle 700’s using only loans. Is this possible?
My last loan was for 11,000 and was paid off in full, with no late payments on 09/2006
Brett
October 6th, 2009 at 12:51 pm
Claudia
Of course, as long as you pay them every month ontime this will greatly improve your credit score.
October 9th, 2009 at 12:34 pm
Albert
I think u can’t
October 9th, 2009 at 10:26 pm
Joanne
Lynn: just because you have a credit card doesn’t mean you have to use it. Congratulations on coming to terms with the fact that you are aware of “inability to control spending on credit cards.” Get a card (or two) and use scissors to cut them into tiny pieces. By not using them, you will have a history of credit and a zero balance… that’s more than many of us can say. Just make sure there’s no annual fee for the cards. You are also wise to have loans for cars and home and things like that rather than burden yourself with consumer debt. I’d say you are on the right track with your financial goals and awareness to your strengths and weaknesses will make you a winner in the long run. Your credit score is made up of credit card history, balance, debt to income, assets versus liability, income, and many other factors so it’s impossible to say what makes your score good or bad. Back in the 50s and 60s there were no credit cards and yet people managed to live within their means instead of what we have going on today with bankruptcy, foreclosures, and sleepless nights. Get copies of your credit reports from Transunion, Experian and Equifax and keep on top of them. Challenge any information that’s incorrect. Don’t worry about your score as much as your plans. Sock money into an emergency fund, take advantage of long term retirement savings, and make compromises with your spending to enjoy life without stress and debt. If you can’t have the best of everything, make the best of everything that you have. Read books by and about millionaires to see what parts of their lifestyle can fit into yours. People with money have money because they watch it carefully. You have to respect that. Keep your eyes on increasing income and reducing expenses and your credit score will follow your goals. Pay on your debts on time and pay more when you can. There’s more to you than what you own and what you owe so be the best you can be.