Fruition Update: Part Two
Welcome to Part Two. If you missed the intro to my Fruition Update Week, you can get caught up here.
Two years ago, when we made the decision to move to Colorado the following year, I realized I’d need to check my credit before house hunting.
My score was in the high 500s, which is pretty terrible.
I called the nice folks at Sky Blue to get guidance on fixing my score.
“Your payment history is great,” they said, “but you don’t have enough debt.”
“That’s not a good thing?” I asked.
“No, because creditors want to know that you’re responsible with your credit.”
“The fact I’m not swimming in debt isn’t evidence enough that I’m financially responsible?”
“No, it doesn’t really work like that.” They sounded amused.
I hate being in debt. Or, more accurately, I don’t believe in being in debt. I canceled all my own credit cards years ago.* My name’s on a shared card with Dan, and that’s it.* And that sucker’s been maxed out* for about forever because paying it off is way down on the list of priorities after things like ‘buy groceries this week.’
So, on the advice of Sky Blue, I signed up for some new credit cards. Secured credit cards reserved for those of us with truly terrible credit scores; you have to send them a deposit, and your credit line does not extend beyond the amount of your deposit.
“So this will really work? These little baby credit cards?” I asked Sky Blue.
“Yep,” they said. “You should expect to gain about 100 points over the next 6 months.”
Sure. Two $200-limit credit cards will gain me 100 points. Because the credit bureaus seriously aren’t smart enough to see through these shenanigans?
But I shrug, and put my billed-monthly YogaGlo membership on one card, and my billed-monthly Netflix membership on the other. A couple $20 payments I can pay off in full every month, even though such a clear gaming of the system feels ridiculous.
Dan does always say, though, that credit is really just a giant Monopoly game.
So, okay. I’ll play.
Before I leave Nevada, about 6 months after getting my stupid secured cards, I check my credit score again. And damned if it isn’t up by a solid 80 points or so. Still not great, but high enough to get us a decent rental.
To buy a house next year, though, I need a better score. I call Sky Blue back for some more advice:
*My credit history is too short. Those canceled cards I’d had since my college years? Should’ve paid ’em off and kept ’em active by charging a few bucks on them every now and then and paying them off every month.
*I don’t have enough credit (still) and I don’t have enough different kinds of credit. Variety counts.
*Credit utilization counts against your score. You should, at any given time, only be using between 20-30% of your available credit. I was using like, 98%.
My history can’t be changed. I can’t get more kinds of credit till my score is higher. And paying down that credit card is my number one financial project for the year. So, all good goals to work toward, but a house is definitely off the table.
Except, I don’t have the money I would have 3 months from now, because we’re still waiting for our house to sell, Dan has some cash coming in from some sculptures, plus I’m waiting for him to arrive, contribute a second income, and give me some financial breathing room. All of these things should come together by July, my target date for car buying. None of them are even close at the moment of Dad’s call, which was in April. A few months later, my dad calls. He wants to buy his car back, the car he sold me a year ago so I could have reliable transportation up here. No biggie; I always knew this wasn’t my forever car and had planned on selling it on Craigslist later on this summer. I already know the next car I want to buy: one of the VW diesels. Big enough for kids, dogs, camping detritus and gets an average of 40 ever-loving miles to the gallon. It’s like the holy grail car we’ve always wanted.
So, maybe I could get a car loan instead of buying with cash, right? Right. Because I am now reluctantly embracing a life of Monopoly debt. The cash from the car sale could be my down payment. And I can pay the loan off when the various ships come in, thus boosting my score while avoiding further debt.
Except, no. I can’t get a car loan because– although I haven’t checked in a while– I’m sure my credit has not improved significantly in the 6 months since my last conversation with Sky Blue, because nothing has changed. In fact, I could use a car loan to add to my credit variety, which would boost my score. So that I can… er, buy a car.
This kind of circular shit is my exact least favorite kind of predicament, because I don’t know which step to take first. Use Dad’s cash purchase to pay down the credit card, which would boost my credit score, which might get me a car loan? Wait, there’s no time to boost my credit score in the 30 days before he picks up the car. Or use the cash to convince the nice auto loan people to take a chance on me? GAH.
Then I decide, screw it, and I just freaking call my bank already. I always feel better when I’m doing something, even if it’s the wrong thing. The super nice auto loan lady was all “How much do you make? How much do you pay in rent? Okay you’re approved!”
And I was all “Uh, what?”
It was seriously that fast. I mean, less than 2 minutes.
And she goes on to say “Looks like you’re approved for a new $7000 limit credit card with us too! Should we sign you up?”
Feeling like I’m on some kind of gameshow and reminding myself to stop being terrified of debt and this is my damned year of fruition after all, I say “Well, I want to buy a house in the next year or so. Will this help me or hurt me?”
She says “Well, probably help you, because it decreases your total credit utilization.”
Of course it does.
So I say yes. Yes to the Monopoly debt, yes to the car loan, yes to the new card. Yes to the new car.
Yes to the new life.
Later, I checked my credit score out of curiosity.
It’s in the 720s now.