Credit stinks. You don't need a credit score.
Credit wastes your money. You DON'T NEED a credit score
Using credit will serve to keep you in perpetual debt. Once again, YOU DON”T NEED A CREDIT SCORE!
Guess what? I don't like credit.
If you've been a participant here at CFF for very long or taken my course, you know where I stand on the issue.
I also believe that you don't need a FICO score to be able to make it in the modern economy, and I have the proof to back it up (more on that later).
The Myth of the Credit Score
Needing a credit score is a common myth that has been perpetuated by credit card companies, banks, and others who have a financial stake in making sure that you believe that having a good credit score means you're winning with money.
Let me repeat myself.
It's a myth that you need a credit score to win with money.
Have I been clear enough up to this point?
A credit score is just a measure of how responsibly you use credit. So if you want to use credit and stay in debt, then by all means, work hard to maintain a high score.
Living Without a FICO Score is Easy
Most of the people I talk to about money tend to agree with me about the wisdom of getting out of debt. But when the conversation turns to not having a credit score, they start getting nervous and confused.
“But you have to have a credit score” they say, “How can you get along without one?”
This is because the mainstream media and so called “Financial Gurus” that take ad dollars from big banks and credit card companies have been drilling that into their heads for decades.
The most common objections I hear are:
- How would I be able to get a mortgage?
- What if I apply for a job and my potential employer checks my score?
- What if I want to rent a place to live?
They use these concerns to justify staying in debt so they can maintain a good score because they think they have to.
But guess what? You can get out of debt, maintain a zero FICO score because you're out of debt, and still do all those things above without any problems at all. Best of all, doing those things without a FICO score is easier than ever.
You Can Still Function Without a Credit Score
In the past, if you didn't have a credit score because you refused to use credit, you could still get a mortgage using manual underwriting, and you would have to be proactive about telling a potential landlord or employer about why you don't have a credit score so they didn't think you were a deadbeat. It could be difficult and time consuming providing documentation that proved you that you were someone who paid their bills on time and had no debt.
But now there is a newer and better way to measure your financial responsibility without having to be in debt to do it.
eCredable is a Better Credit Score
This better way is called eCredable (by the way, I'm not getting paid to write this). ECredable is a financial scoring service that takes into account the regular bills you pay that are not typically reported to the national credit agencies, such as utility bills, cell phone bills, insurance premiums, day care, school tuition and many others.
If you consistently pay your bills on time, then you can maintain a good “alternative” credit score (the people at eCredable call it your AMP credit score) without having to resort to using credit cards and other forms of debt just so you can maintain a good traditional credit score.
Your AMP credit score is easy to understand because it uses a grading system of A-F just like you had in school, and improves or declines as your bill paying history progresses. If you fall behind on your bills your score will obviously go down. But if you establish a good track record of paying on time, your score will obviously be at a high level.
eCredable is Legit!
A great feature of the eCredable AMP score is that, by law, it can be used as a standalone report and must be taken into consideration by a creditor if you request it. It can also be used as a supplement to your traditional credit scores from Experian, TransUnion, and Equifax.
I didn't want to get into all the hairy details about how it all works, that's a much longer post for another day. You can go to their website to do that.
But I did want to let you know what's available out there for those of you who want to get out of debt and get rid of the demon plastic.
You don't have to live in fear of not having a credit score if you're getting out of debt.
Additionally, you don't have to live by the rules of the big banks and the credit card companies ever again.
You don't need them.