I need a credit card (i think)

[daywane]

ever listen to Dave Ramsey on the radio?
I do.
I have fallowed his rules as best as I could.
I have not been able to do the baby steps for emergency fund.
well I guess i could / should have.
I put all motivation in paying off all bills.
I have no bill other than utilities.
medical bills are racking up fast.
each hospital visit is $250.00 up front. Co pays at Doctor visits are running $15 to $30.00
Pelvics alone was $50.00
Now there telling me to toss them!!!! Screw That , I gave them to my Step Father... save him a months supply

I went to get a loan... I thought with a $50,000 dollar home as collateral I was golden. 

I found out the bank wanted closing cost! $250.00 + intrest on a simple $2,000 dollar loan!
after some reseach I find this a common practice.
$125.00 for lawyer
$100.00 for bank
 $25.00 for court house
 :banghead:then add intrest for loan!!! screw that
OK now I hit problem.
I have no credit history. 2 bank loans ... Paid off early . 10 years ago
credit card paid of 10 years ago.
bank said I have no credit report!
how is the best way to get a credit card?
Or should I tap into 401K and pay medical bill and just pay back the 401k?

[pinballwizard79]

Tap the 401k since you cannot get a 0% card, at least the interest you pay on teh 401k goes back to you.

Those costs are normal, they have to record the debt in city hall if its against your house & have a notary sign off on a legal document which may require a lawyer depending on your state & of course the bank has a processing fee......... Mortgage closing costs are from $5k to $25k all day long in some cases BTW.

[shardian]

Yes you need a credit card to build your credit.

No you shouldn't tap your 401k except as an absolute last resort. General Hospitals cannot refuse you service, and will generally leave you alone collection wise as long as you make some sort of payment.

[DaOld Man]

I agree with Shardian on the no tapping of the 401 K.
Unless you are at a certain age, Uncle Sam will rip you a new one in fees and taxes.

(Taxes suck... TEA!!)

[Blanka]

American creative financing is the source of the financial crisis. With all this neurotic crap I totally understand 
Get a bank account in Iceland. Even those are better!

[Blanka]

I think Visa and Mastercard should make a distinction soon. There should be two types of credit cards:
- One for people that need a plastic card to pay stuff and that is accepted everywhere (guess Americans call this a "Debit Card", but this is how most Europeans use "Credit Cards")
- One for people who want to buy stuff they don't have money for (How they tell us Americans use their "Credit Cards").

I want a credit card that automatically deducts all payments from my bank account directly. Why do I have to be X-Rayed for my financial history for that? There is enough cash in the account. The Dutch PIN card or the European Meastro card are not nearly as much accepted as the CC plastic.

[Malenko]

if youre asking how to establish some credit, get a gas card or store card, charge something trivial on it and establish a payment history. I did it with best buy, but I would suggest a store that doesnt rape you in interest and late fees. I charged $11, was 1 day late paying, they charged me $50 late fee and like $1.27 interest but yeah. store card or gas cards are your best bet

[ChadTower]

I want a credit card that automatically deducts all payments from my bank account directly.

We do have that.  Checking account debit cards usually carry either a Mastercard or Visa logo and are accepted through their infrastructure even though it's actually taking money directly from checking with no credit involved.

Don't tap your 401k.  That should be the last thing you do.  You're going to have to feed yourself when you live through this and that's how you are going to do it.

[JeepMonkey]

Do not tap into your 401k.

Using a credit card will build credit history.  I travel for work and use my personal credit card for my expenses.  I probably averaged $5000 a month in expenses during 13 months over the last two years.  I was reimbursed every two weeks, so I always had money to pay off my balance and was never late.  This really increased my credit rating pretty fast.

I am not saying you have to charge a lot of money each month, but use your credit card for normal things like groceries, gas, etc and make sure you pay it off on time.  This will help you establish good credit.  It also helps if you can access your account online or at least have free bill pay by phone.

Listen to Dave, he will get you there.

[RayB]

Dawayne, The reason they wanted those extra fees is because you were offering your home equity as collateral. Those fees go toward doing the due diligence on th evalue of your home, how much you owe, etc...

So the answer is, don't get that kind of card. Just get a standard loan with your bank.  Do you have a bank you've been with for a long time? If so, then it doesn't mater so much that you don't have a credit report, you still have a history with THEM that they have access to.

[pinballwizard79]

I think everyone here forgets a 0 FICO score gets you 0 credit card options other than secured with an annual fee which requires the exact money he needs to borrow (horse, meet cart)..............maybe a $250 1st premier card that gets shipped to you with a $200 balance (hmmm, $50 short of a secured card).

Its doubtful a regular bank (BOA, USB & etc) will give him money regardless of his history.....if he is with a credit union that may be different but what bank really lends their OWN LOCAL money with a Visa logo on it?

I dont know everything though so just give it a try, its easy to apply online but the inquiries will add up fast against your FICO......oh wait there isnt a score so its just future declines based on too many inquiries.

Also there is a HUGE difference in borrowing against your 401k & cashing it out FYI.

[pinballwizard79]

I forgot, you can also ask your local bank or CU for a HELOC (closing costs rolled in).

If they use private funds (which it sounds like they will have to) expect prime + a margin of prob 4.25 with a current fully indexed floating rate of around 8% (if you were A paper it would be -0.25 to -1.00 of a margin = 2.5% but dont cry over spilled milk)

Fannie Mae isnt going to buy this so dont default & expect Obama Fiat paper to help you later on :-)

You are going to pay out the ass to borrow money no matter what you do since you dont have credit, but once you get a FICO you can get money so cheap you could almost invest it (hello leverage).....building credit will take time, a lot of time.

[RayB]

Since we're on the topic, someone explain to me why a guy like him can't get a credit card, but college applicants with no credit history, no job, and possibly no maturity, no sense of responsibility, no experience with how to use credit, etc, etc, etc get cards handed to them like they were candy?

[Vanguard]

I think those days are coming to an end too.  The mortgage market implosion has credit companies tightening the requirements for who can qualify.

[daywane]

sounds like more rice and beans and beans and rice.
The bank wants a co signer for just a plain loan. Mom offered to do so.
Nope! I want to do this on my own. I am 44 years old.
I used to get credit cards in the mail all the time. I allways shredded them
wish one would show up now.
Wal mart and K mart asks me to fill out a app every time I shop there.
I guess I will apply. Heck gas is 15 cents cheaper if you use a Wal mart card.
I could try what my mother does. She has 1 card. Everthing is paid with her card.
I mean every thing. gas, groceries, utilities, then she has only 1 check to  right a month.
I have watched her do this for years.
several times, cards have dropped here because she allways pays off in full every month

[Fordman]

ever listen to Dave Ramsey on the radio?
I do.
I have fallowed his rules as best as I could.
I have not been able to do the baby steps for emergency fund.
well I guess i could / should have.
I put all motivation in paying off all bills.
I have no bill other than utilities.
medical bills are racking up fast.
each hospital visit is $250.00 up front. Co pays at Doctor visits are running $15 to $30.00
Pelvics alone was $50.00
Now there telling me to toss them!!!! Screw That , I gave them to my Step Father... save him a months supply

I went to get a loan... I thought with a $50,000 dollar home as collateral I was golden. 

I found out the bank wanted closing cost! $250.00 + intrest on a simple $2,000 dollar loan!
after some reseach I find this a common practice.
$125.00 for lawyer
$100.00 for bank
 $25.00 for court house
 :banghead:then add intrest for loan!!! screw that
OK now I hit problem.
I have no credit history. 2 bank loans ... Paid off early . 10 years ago
credit card paid of 10 years ago.
bank said I have no credit report!
how is the best way to get a credit card?
Or should I tap into 401K and pay medical bill and just pay back the 401k?

My Friend I am an Avid Dave Ramsey Listener and follower also!

First of all, if you have followed the steps in his book, then the hospital bills shouldnt be an issue. Second, why are you wanting to get a loan on hospital bills anyway? The hospital bills dont acrue interest, loans do. Why pay all the up front fees of $250.00 for a $2,000 loan? Seems kinda silly to get a loan to pay off a non-interest acrueing hospital debts. Also, with the hospital bills, you dont have to use your home as collateral. The Hospital cant use that your previous bill hasnt been pid against you if you need to be seen again. If they do, then they have broken HIPPA laws. HIPPA just isnt between you and your Doctor, it also covers your bills.

All hospitals are required by law to at least "band-aid" you unless you are in a "state of emergency" then they have to use life saving measures to keep you alive, insurance or not.

DO NOT tap the 401K. It's not worth it. Chances are, if you miss a 401K payment, the 401K account manager probably has the right to forclose on your 401K account, then you will automatically pay the 10% government penalty and then pay income tax on top of it! 99% of 401K plans have an administarator (bank) that allows for 401K's to be forclosed upon for even the slightest thing. Some 401K borrowers now owe the 401K more than the account is worth because of the 40% loss in the stock market in the last year.

I dont know what kind of insurance plan you have (if any) but if you have met the out of pocket exspense for the year, then turn over all the bills to them. Sounds like you need a tax-deferred Health Savings Account. Pre-tax dollars, out or your paycheck, up to $1,150 single, $2,300 family, can go into an account and used to pay medical co-pays or any other out of pocket exspense.

Credit cards are junk and I havent used one in over three years. I have used the book as a living guideline now and a monthly budget. If all goes well, my home will be paid for within the next 7 years instead of 21 and I am saving about $2,200 a month I was paying on credit cards. My air conditioner broke down in the early summer, it cost $345 to fix it, no sweat! Whipped out the cash! Kinda scared the service man as he said he hasnt had to stop at the bank for a cash deposit in years.

Dont get a credit card, why pay 22% more for your medical bills when you can hardly pay them now?

Need more Dave Ramsey help? PM me and I'll help ya out. Sounds like you need the little kick that some need to be re-motivated!

 

Fordman

[Fordman]

Since we're on the topic, someone explain to me why a guy like him can't get a credit card, but college applicants with no credit history, no job, and possibly no maturity, no sense of responsibility, no experience with how to use credit, etc, etc, etc get cards handed to them like they were candy?

Because the money is backed by Sallie Mae (fed govt)  and 90% of the loans are used for tuition and books but there are those that use it for pizza and beer!

Seems like exspensive pizza and beer!

Fordman

[protokatie]

Since we're on the topic, someone explain to me why a guy like him can't get a credit card, but college applicants with no credit history, no job, and possibly no maturity, no sense of responsibility, no experience with how to use credit, etc, etc, etc get cards handed to them like they were candy?

Because the money is backed by Sallie Mae (fed govt)  and 90% of the loans are used for tuition and books but there are those that use it for pizza and beer!

Seems like exspensive pizza and beer!

Fordman

Don't forget that it is an easy way for these CC companies to get young'uns hooked on credit cards, esp with the hope that the kids think they are getting ahead on their cc bills by paying the minimum payment. (Someone correct me if I am wrong, but paying the minimum payment amounts to finally paying off a $2000 CC debt takes like 25 years and ends up costing you more than $15000, or something rediculous like that)

[Blanka]

We do have that.  Checking account debit cards usually carry either a Mastercard or Visa logo and are accepted through their infrastructure

In Europe that option is not available. You must pay with the credit card itself, and give the company a zillion calls to set it to automatic deduction.

[danny_galaga]

I've always been perplexed by this 'credit history' stuff. Seems everyone buys something not so expensive on credit, just so they can have some 'history'. Surely the institutions can see that? When i was 20 or so i was approved for a loan to buy a unit. I was an apprentice, so below minimum wage, and never had credit for anything. All the 'experts' told me i should get a loan for a car first before a house. I figure the bank that approved me could see i'd saved money by NOT getting anything on credit and thus i was a sure thing to service my debt 

[protokatie]

Danny, it is all about how much you OWE not how much you OWN. It is a sick system, to the point that fiat money is mostly given value based on debt to banks, and not any real world intrinsic value. A few months back I posted a thread on how money is made (it isnt made by the treasury of any nation, but by the banks).

The only time a bank will care about what you own is as collateral against you failing to pay interest (plus principal, of course...)

[ChadTower]

The Hospital cant use that your previous bill hasnt been pid against you if you need to be seen again. If they do, then they have broken HIPPA laws. HIPPA just isnt between you and your Doctor, it also covers your bills.

They can if it's the same hospital.  HIPAA protects against disclosure to uninvolved parties, but if the party has reason to have been involved last time (like sharing a billing system) then HIPAA doesn't apply.

[ChadTower]

Because the money is backed by Sallie Mae (fed govt)  and 90% of the loans are used for tuition and books but there are those that use it for pizza and beer!

Seems like exspensive pizza and beer!

Ray wasn't talking about student loans.  He was talking about credit cards and he's right.  They are given out like candy to college students.  We used to have trouble just walking from class to class without someone coming right up to us and offering us bonus prizes for filling out a Discover Card application.  Kids would be in their third year of college and have already rung up $25k in credit card debt.  Trust me, that wasn't tuition and books, it was lifestyle spending. 

[JeepMonkey]

Credit card companies have admitted to doing research that shows that people are more "loyal" to the first credit card they receive.

I was recently notified by my HELOC lender that the $5000 line of credit I had was no longer available as they "determined" that my home value has come down due to the housing market.

[RayB]

sounds like more rice and beans and beans and rice.
The bank wants a co signer for just a plain loan. Mom offered to do so.
Nope! I want to do this on my own. I am 44 years old.
I used to get credit cards in the mail all the time. I allways shredded them
wish one would show up now.
Wal mart and K mart asks me to fill out a app every time I shop there.
I guess I will apply. Heck gas is 15 cents cheaper if you use a Wal mart card.
I could try what my mother does. She has 1 card. Everthing is paid with her card.
I mean every thing. gas, groceries, utilities, then she has only 1 check to  right a month.
I have watched her do this for years.
several times, cards have dropped here because she allways pays off in full every month

That's a good strategy if there's absolutely no interest on all those purchases, and a great strategy if its a points card.

@Fordman: great advice

[Fordman]

ChadT- I believe you may be mis-informed about HIPPA, each time you visit the Emergency Room, it has to be treated as if you've never been there before. When you see that wonderful person that admits you to the hospital, they ask you to sign 3 HIPPA forms. One is for the hospital to share info with your personal physician. The second is so the Doctors and Nurses at the ER can ALL see your currently building charts in case there is a shift- staff change sometime during your visit. Third is so your agreement for an independent lab to maybe have to do lab work with any body fluids and that the lab and current Doctors and Nurses are able to view & discuss the lab results.

Your bills must be billed from a third party biller, but usually the biller is also owned by the hospital under a different name (University Hospital - University Hopital Claims & Services for example). The bills are also coded so only ICD-9 and there is another software, but the name escapes me right now, readers are able to see what you are actually being billed for. The coding is for your privacy incase your bill ends up in someone elses mail box or you drop it or something like that. The coded bill goes to your insurance also, which they have the same ICD-9 software to decipher the bill and pay the hospital-Doctor.

As for dawayne and his predicament: Question for you:

Do you still contribute to your 401 each paycheck? If so, STOP! Take the funds your putting into your 401K and use every penny on the building debt. You probably arnt building any money in your 401K right now anyway, other than what you are putting in. Does you employer match funds? If so, that is the only downfall from currently suspending your 401K contributions. You should be able to stop the contributions at any time, but may only be able to re-start every 90 days or so, depending on your 401K and how its set up.

 

Fordman

[ChadTower]

ChadT- I believe you may be mis-informed about HIPPA, each time you visit the Emergency Room, it has to be treated as if you've never been there before.

I write software for a living that conforms to HIPAA.  What has to happen is the medical information needs to be stripped out so that the people handling the billing have no way of connecting the treatment/condition/incident to the individual.  The amounts charged are still handled under a single billing account for collection purposes.  That's why when you call a hospital sometimes the operator can't actually tell you exactly what each item on your account is for - because that info is not being presented to them, only dates and charges. 

The billing dept has full access to how much your accrued balance is over time.  They would be completely unable to do their job if they didn't have that information.  Of course, your explanation just mirrors what I'm saying, even though for some reason you tried to tell me I'm wrong.   

The billing is not the same as the medical information and HIPAA only protects the medical information.  There is no protection from your financial accountability in HIPAA.

[danny_galaga]

Danny, it is all about how much you OWE not how much you OWN. It is a sick system, to the point that fiat money is mostly given value based on debt to banks, and not any real world intrinsic value. A few months back I posted a thread on how money is made (it isnt made by the treasury of any nation, but by the banks).

The only time a bank will care about what you own is as collateral against you failing to pay interest (plus principal, of course...)

Well, like i say, i chose to ignore accepted practice, and lo and behold the bank was happy to roll with it. I owed no one anything, and all i owned was a crappy second hand car...

[protokatie]

Danny, it is all about how much you OWE not how much you OWN. It is a sick system, to the point that fiat money is mostly given value based on debt to banks, and not any real world intrinsic value. A few months back I posted a thread on how money is made (it isnt made by the treasury of any nation, but by the banks).

The only time a bank will care about what you own is as collateral against you failing to pay interest (plus principal, of course...)

Well, like i say, i chose to ignore accepted practice, and lo and behold the bank was happy to roll with it. I owed no one anything, and all i owned was a crappy second hand car...

Well, if you care about your fellow (gal-ow?) arcade fan, then sponsor me to move to OZ and get a "green" card there. I have skills... Maybe a change of scenery would do me good. Oh wait... I would be called a Sepo everywhere I went... Damn Australians... :<

[danny_galaga]

Danny, it is all about how much you OWE not how much you OWN. It is a sick system, to the point that fiat money is mostly given value based on debt to banks, and not any real world intrinsic value. A few months back I posted a thread on how money is made (it isnt made by the treasury of any nation, but by the banks).

The only time a bank will care about what you own is as collateral against you failing to pay interest (plus principal, of course...)

Well, like i say, i chose to ignore accepted practice, and lo and behold the bank was happy to roll with it. I owed no one anything, and all i owned was a crappy second hand car...

Well, if you care about your fellow (gal-ow?) arcade fan, then sponsor me to move to OZ and get a "green" card there. I have skills... Maybe a change of scenery would do me good. Oh wait... I would be called a Sepo everywhere I went... Damn Australians... :<

Hehe. We arent even in a recession yet, so i invite all you Seppos over if you need work (",)

[daywane]

Danny, it is all about how much you OWE not how much you OWN. It is a sick system, to the point that fiat money is mostly given value based on debt to banks, and not any real world intrinsic value. A few months back I posted a thread on how money is made (it isnt made by the treasury of any nation, but by the banks).

The only time a bank will care about what you own is as collateral against you failing to pay interest (plus principal, of course...)

Well, like i say, i chose to ignore accepted practice, and lo and behold the bank was happy to roll with it. I owed no one anything, and all i owned was a crappy second hand car...

Banks here do not work that way. Seems strange to me.

as for my 401K is , I think it is crazy to toss out close to $100.00 a month (company match) out the window.

I think I can recover the $100.00 a month in utilities.
! thing I have found a leak I have had for some time. (At least I think I have had it for a very long time)

My house has a concrete slab floor. 2 weeks ago water started flowing in my bathroom floor. (this happens from time to time on large rains.)
but it never quit. I was in the hospital at the time, talking to wife on phone, She described the problem... I thought about it and said we have not had that much rain in a few days. I called my brother up. He turned off water valve to main  line, Problem is gone.
2 days later I am out of hospital. I had my brother cut the expected bad pipe. Capt it off and problem solved. I have lost cold water to kitchen sink and clothes washer.

My temporary fix is a garden hose to the kitchen sink and washer ... This is only temporary till I fill better. I will find the other end of line in the wall as soon as I can and put a new line in.

my water bill has allways been much higher than neighbors. I all was thought it because my wife is a house wife, Home 24/7

also I hear the electrick company charges differant rates at differant times of the day?

I will check this out also. My electrick bill is also much higher than all neighbors also.

[Fordman]

You are correct about the electric company charging different rates. 2:00pm to 11:00pm are considered 'Peak Hours' and that is when you are charged different per killowatt hour. Some states regulate the 'Peak Hours' and others dont. Mississippi & Alabama dont regulate their eletricity suppliers so usually the home owners get raked over the coals during 'Peak Hours'. Peak Hours are the hottest hours of the day which usually drain the grid more when air conditioners are running full blast.

If you need the dollars now to pay bills or to eat, then stop the 401K contibution only temporarily. Then when your back on your feet, then start back up again.

All kinds of ways to cut down on the bills. If you have cable or sattelite, cancel it. Shop around for cheaper car insurance (although cheaper doeant mean better). Do you have a term life policy payment that you can put on hiatus for 6 months? Do you use store brand instead of Charmin? (Tough decision there). COUPONS COUPONS COUPONS! Use your local library for movie rentals instead of Blockbuster. Homebrew some iced tea instead of soda. Recycle the cans, plastic and then find a McDonalds or gas station for your real garbage and dump it there (instant $60.00 savings per month). Plenty of cost cutting options! I couldnt believe how much I was wasting on stuff until I had taken a personal inventory and it blew my mind! My monthly savings are round $1100 a month now!

Hope you feel better and get that leak fixed before you have slab/foundation damage!

Fordman

[protokatie]

then find a McDonalds or gas station for your real garbage and dump it there (instant $60.00 savings per month).

Dunno about a 60 a month savings on that (how much crap DO you throw away a month?). But on another note; using such facilities to dump your personal trash can get you into trouble. It is theft of services, and as you are using private property to do it, trespassing. If they have locks or doors around their dumpsters, and you circumvent those obstacles, you can add a potential breaking and entry (esp if they have a "no unauthorized dumping" sign).  I have worked at places (C stores et al) where we had to go after people using the dumpsters for their personal trash. It costs a lot of time/money to clean up when those things get over filled (the trash guys refuse to pick up the refuse if the dumpsters are over loaded).

[Fordman]

Here where I live, it's $60.00 per can per month. It is that exspensive because we are running out of landfill space here, but no one wants a new one in their area, so its to help encourage recycling.

Here's where the 'DUH!' factor comes into play. You dont throw away receipts or anything with your name or account transaction ID #. That stuff gets shredded. After we recycle, we really dont have that much real garbage and the garbage can out in front of a restaurant or gas station is perfect for the real garbage that we do generate! I'm not talking about 3 hefty bags full of garbage and trying to dump in a dumpster!

 

Fordman

[ChadTower]

Where I live there are no landfills left.  The towns all pay a third party service to do curbside collection and ship it off to NJ.  Even here it's $125/year + $1.25/bag.  Recycling is included so if you consider my household average at two adults and two kids we put out 1 bag a week and 2-3 bins full of recyclables.  That's roughtly $10/month service fee plus $5 in bag fees for $15 total.  You'd have to be putting out ten full bags of trash every week to spend $60/month on trash disposal or you'd have to be constantly throwing away furniture and TVs (special waste comes with extra fees).

[daywane]

mine is $85.00 every 3 months
we can not toss out furniture or appliances.
we have to take them to the county barn. That is free.