Refusing credit card deal for home? Not necessarily so
It may sound unbelievable but if you make your best credit card deal today, you may lay a good foundation of a home purchase in the future.
Such a valuable type of real estate as home has always been a fabulous price in the USA and most people resort to a loan to pay it off. And it is a well-known fact that to be approved for a loan or a credit card, you're required to have a good-to-excellent credit history.
Thus, when you come to the age (18 years old) and become eligible for credit card, why not make a deal even if it were a secured credit card and so start providing for your future home purchase? What's more, it's not necessary that you should apply for exactly secured card. As a beginning credit consumer, you can opt out from no credit credit cards or student credit cards which start your credit file and help make a good credit score if managed well.
Such great credit card companies as Discover and Chase Bank will readily offer you student credit card deals with no good credit history requirement. If you aren't a student, no credit credit cards from First PREMIER Bank will always be a good option as they are a guaranteed approval deal for starters.
Well now you know what to start from. It's high time to work for your home! Only make sure that in the home purchasing process your plastic plays a subsidiary but not a destructive role...
The way you manage your credit card can work to your good in intention to buy home and can significantly facilitate the process of application for the loan.
On the contrary, if you fail on credit card management and get some negative items on your credit report, lowering the credit score, you may face tangible difficulties when buying a home.
From the moment Miriam became a college student, she realized that on graduation she would have to make her living on her own. Buying a home was her first-priority plan and she knew it was time to provide for its realization.
So, she got a credit card and not once. You know what a college life is like. Following her friends, Miriam, started putting unnecessary purchases on the card and constantly carried balances. Her parents used to tell her she was damaging her credit history and credit score and she wouldn't be approved for a home loan unless she repaired her credit rating and close the account in the end.
Miriam wouldn't listen though and when the moment came she appeared ineligible for such a big purchase. The lenders explained the denial in the following words:
"The major part of the credit failure has been caused by too many credit card issuances, late or missed credit card bill payments and high utilization ratios (the difference between the balances and credit card limits). You should have kept the utilization ratio on your credit card below 50% of the credit limit available and refuse from making new credit card deals..."
As you can guess, Miriam did not get her long-waited loan though she was sure the fact that she had a credit card would be a guarantee. But simply holding a credit card is not enough. By credit card management you are to show to potential money lenders that you are a good risk and a valuable, creditworthy customer.
If you think of a credit card as an affective tool to provide for a future home purchase, make sure you build a good and stable credit history and a high credit score to use as a proof of your creditworthiness.
